After nearly 10 months, Chinese property giant Country Garden (碧桂园) resumed trading at the Hong Kong Stock Exchange (HKEX) on 21 January. The company made a statement in the morning saying that it had met all requirements set up for it to resume trading. Country Garden surged 3.09% as soon as trading began in Hong Kong and continued growing. Its share prices reached a whopping 30% at one point before settling at 23.71%, up from its last trading day when the market closed, at 0.60 HKD (0.077 USD) per share.
The results of Country Garden’s first day back on the HKEX far exceeded market expectations. In combination with recent policy changes, the real estate sector received a boost from the market, both in Hong Kong and Mainland China. Vanke was up 7.45%, CCCG Real Estate grew 5.32%, and Gemdale Corporation saw a 5.19% increase in its share prices. In fact, property stocks had more transactions in half a day on 21 January compared to the entire day the day before.
In April 2024, Country Garden’s stock was suspended pending its financial results from 2023. It also faced a delayed liquidation hearing in Hong Kong, filed by creditor Ever Creditor Limited. However, Country Garden announced its debt restructuring agreement with 7 banks on 9 January, as well as releasing its 2023 annual report and H1 2024 report on 14 January. Country Garden’s total revenue in 2023 was 401 billion RMB (54.82 USD), with a loss of 200.96 billion RMB (27.47 billion USD). In the first half of 2024, the company’s loss was reduced to 10.8 billion RMB (1.48 billion USD) against 102.1 billion RMB (13.96 billion USD) in revenue.
The uplift in business gave Country Garden and its investors the confidence to face the liquidation hearing and restart trading. With the Chinese government pledging policy changes to help the ailing real estate sector, Country Garden might just have a shot at reviving itself in 2025.
