Head of China Research - Forsyth Barr Asia, Forsyth Barr Asia

David Millhouse

Head of China Research - Forsyth Barr Asia

Forsyth Barr Asia

Thematic (Sector/Industry)

Kaisa failed to make an interest payment due Jan 8 on $500 million of 10.25% dollar bonds (the first Chinese property company to default on offshore bonds) and on Jan 12 got a waiver on a HK$400 million loan from HSBC.&nbsp; The notes dropped 40 percent last month as some of Kaisa’s Shenzhen projects were blocked and executives including founder Kwok Ying Shing quit. They continued to fall in January, reaching 29.9 cents on the dollar on Jan. 7. Its $800 million of 8.875 percent 2018 bonds also plunged.

Kaisa failed to make an interest payment due Jan 8 on $500 million of 10.25% dollar bonds (the first Chinese property company to default on offshore bonds) and on Jan 12 got a waiver on a HK$400 million loan from HSBC.&nbsp; The notes dropped 40 percent last month as some of Kaisa’s Shenzhen projects were blocked and executives including founder Kwok Ying Shing quit. They continued to fall in January, reaching 29.9 cents on the dollar on Jan. 7. Its $800 million of 8.875 percent 2018 bonds also plunged.

China Property / Debt - when Kaisa broke our Trust

China A-shares closed down almost 8% on Monday, on heavy volumes, the largest fall since February 2007. Whilst there were several negative announcements (corruption crackdowns, insider selling at SOEs, regulator speeding up IPO approvals), the KEY reason for the move was the margin trading suspension at three of the largest brokers in China. The brokers, banks and insurance sectors were all limit down. Below we look to explain:<ol><li>What changes to margin trading have been made, and the implications </li><li>How large margin trading in China is </li><li>Does this mean the government wants the stock market down </li><li>Our view on A-share market going forward </li></ol>

China A-shares closed down almost 8% on Monday, on heavy volumes, the largest fall since February 2007. Whilst there were several negative announcements (corruption crackdowns, insider selling at SOEs, regulator speeding up IPO approvals), the KEY reason for the move was the margin trading suspension at three of the largest brokers in China. The brokers, banks and insurance sectors were all limit down. Below we look to explain:What changes to margin trading have been made, and the implications How large margin trading in China is Does this mean the government wants the stock market down Our view on A-share market going forward 

This week's flash-crash in China: thoughts and implications

China


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China Property / Debt - when Kaisa broke our Trust

Kaisa failed to make an interest payment due Jan 8 on $500 million of 10.25% dollar bonds (the first Chinese property company to default on...

David Millhouse

This week's flash-crash in China: thoughts and implications

China A-shares closed down almost 8% on Monday, on heavy volumes, the largest fall since February 2007. Whilst there were several negative...

David Millhouse

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)