China’s property stocks rose the most in more than four months after a newspaper report that the government may ease financing for developers.
The Shanghai Stock Exchange Property Index rose 4 percent at the close of trading, the biggest gain since Feb. 5. China Vanke Co. (000002), the biggest listed developer on mainland exchanges, jumped 8.4 percent to 9.85 yuan in Shenzhen. Poly Real Estate Group Co. (600048), the second largest, added 6.2 percent to 9.91 yuan.
Chinese companies that have property-related businesses may be able to apply to raise funds and restructure without spinning off those businesses, China’s 21st Century Business Herald reported today, citing an unidentified property company official. The report is another sign that the regulator will ease a crunch that sent China’s overnight repurchase rate to a record last week.
“This is definitely good news for developers if the report is true, because that’ll cut the refinancing costs substantially,” Dai Fang, a Shanghai-based property analyst at Zheshang Securities Co., said “It may also be a move from the government to help developers from a credit crunch and boost the economy.”
The country has banned developers from issuing new shares, share placements and restructuring since at least 2008, according to Dai.
China will use various tools to adjust liquidity, central bank governor Zhou Xiaochuan said today in Shanghai.
In Hong Kong, China Overseas Land & Investment Ltd. (688), the biggest state-owned developer, rose 4.6 percent to HK$20.35, the most in two months, while Agile Property Holdings Ltd. (3383) jumped 5.1 percent to HK$8.32.
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