Lucror Analytics

Lucror Analytics is a leading credit and ESG research specialist and a provider of technology solutions for differentiated fixed income strategies. Our roots are in bottom-up fundamental credit analysis with a specialization in high yield corporate credits from Europe, Asia and Latin America. We are one of few research specialists integrating ESG considerations with fundamental credit research through a dedicated ESG platform. Our ESG assessment covers five key criteria: Disclosure, E,S, & G Pillars, Controversies, ESG Impact on Credit and ESG Momentum.

Recognizing the importance and value-add of Factor Investing in fixed income, Lucror developed the Smart Quant Navigator (SQN), an intuitive platform that helps clients devise and implement factor-based strategies ranging from pure quant to active fundamental, with integrated ESG.

Our company has been at the forefront of developments in the fixed income markets, identifying opportunities and consistently delivering new products and value-adding solutions to clients. Lucror has close relationships with the largest and most reputable asset managers, family offices, hedge funds, investment and wealth managers globally.

High Yield Experts

Credit Analyst, Lucror Analytics

Chuanyi Zhou

Credit Analyst

Credit

We view China Evergrande as “High Risk” on the LARA scale. The company's financial risk profile is highly leveraged. Evergrande has been growing at an extraordinary pace, utilising debt for funding. It now plans to slow its expansion and deleverage. The company’s core development business has the following strengths: [1] predictable revenue growth, backed by adequate saleable resources; [2] its presence and sales network are the largest in China; and [3] its mass-market products, which are targeted at first-time home buyers. These advantages are partly offset by the debt-funded growth, increasing land costs, and aggressive financial policies. Evergrande has halted dividend payouts in preparation for its potential onshore listing. Our fundamental Credit Bias is “Stable”, given the consistent improvement in revenues, margins and debt structure. The company is likely to maintain its robust operations in preparation for the A-share listing. That said, we remain cautious about the debt-like nature of the strategic investments in its onshore subsidiary, along with the guaranteed dividend and repurchase options. We view the group as “Weak” on the LAGA scale, given the Chairman's dominance of the Board, and the company's continued investments into non-core businesses.

   We view China Evergrande as “High Risk” on the LARA scale. The company's financial risk profile is highly leveraged. Evergrande has been growing at an extraordinary pace, utilising debt for funding. It now plans to slow its expansion and deleverage. The company’s core development business has the following strengths: [1] predictable revenue growth, backed by adequate saleable resources; [2] its presence and sales network are the largest in China; and [3] its mass-market products, which are targeted at first-time home buyers. These advantages are partly offset by the debt-funded growth, increasing land costs, and aggressive financial policies. Evergrande has halted dividend payouts in preparation for its potential onshore listing.    Our fundamental Credit Bias is “Stable”, given the consistent improvement in revenues, margins and debt structure. The company is likely to maintain its robust operations in preparation for the A-share listing. That said, we remain cautious about the debt-like nature of the strategic investments in its onshore subsidiary, along with the guaranteed dividend and repurchase options.    We view the group as “Weak” on the LAGA scale, given the Chairman's dominance of the Board, and the company's continued investments into non-core businesses. 

China Evergrande - Tear Sheet - Lucror Analytics