Rapid Plunge in Developer’s Bonds Shows Transparency Risk in Chinese Property
- Zhenro’s perpetual note fell on fears it wouldn’t be redeemed
- Moody’s cuts co.’s credit rating deeper into junk to B3
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Zhenro Properties Group Ltd.’s spiraling bond prices show just how risky it is to invest in Chinese developer debt -- even when a repayment looks imminent.
The firm’s $200 million perpetual bond was trading at 93 cents on the dollar before it plunged 59.3 cents Friday, after concerns emerged that the firm may not proceed with a planned redemption of the note in March. The borrower’s dollar bonds extended steep declines Monday and its shares were poised for a fresh low after falling about 70% since Thursday.