Zhenro Shares plunge: 66% real estate service 57% real owners forced to liquidate some of their shares
February 11th, Zhenro system’s share price collapsed, the lowest fell to hk $0.68 that day, down 81.42%.The shares fell 66.12 per cent to HK $1.24 at press time.Due to the falling stock price, some of the shares held by Ou Jong-young, the actual controller of Zhenyoung Real Estate, were forced to liquidate.Bonds, Shanghai Stock Exchange news, “20 Zhenrong 03” this afternoon trading abnormal volatility, two temporary suspension.Closed down 23.03%.For the reason of the slump, there are rumors that Zhenro will not redeem $200 million of perpetual bonds as previously planned in March this year, and zhenro overseas bonds will be restructured, related rumors triggered today’s zhenro real estate stocks and bonds double kill.In response to these claims, reports that Zhenro responded to investors by saying it would redeem $200 million in perpetual bonds as originally planned are not true.In this regard, zhengrong real estate a relevant personage said, there is no external company at present.There are rumors that there may be malicious short-selling of formal real estate and Zhenro services. Zhenro officials did not comment on this.Affected by its parent, Zhenro Services also recorded a sharp fall today, falling 57.7 per cent to HK $1.73.It is worth noting that On February 8, Haitong International specially promoted Zhenro Service in its industry research report, saying that it takes a prudent attitude in related party transactions, has no share placement and has healthy cash flow, thus maintaining its outperform rating with a target price of HK $8.09 per share.At present, There are 11 outstanding bonds of 5.944 billion yuan, among which 1.677 billion yuan will mature within one year.In terms of offshore open market debt, Zhenro has 15 outstanding US dollar bonds with us $3.703 billion outstanding, of which US $2.22 billion will mature within a year.Since the end of 2021, a number of housing enterprises thunder, and Zhenro real estate performance is relatively calm.In a meeting with investors, Zhenro announced on January 4 that it planned to redeem its $200 million of perpetual bonds on March 5 as the coupon jumped to 15 percent from 10.25 percent, according to earlier reports.The company’s financing costs rose from 307 million yuan in the first half of 2020 to 356 million yuan in the middle of last year, up 15.8 percent year-on-year, according to its interim report.Under pressure from debt, Zhenro began selling stakes in projects in January.Among them, On January 30, Zhenrong (Xiamen) Real Estate Co., Ltd. transferred 49% equity of Xiamen Ronglu Real Estate Co., Ltd. and Ping An Trust Co., Ltd. took over.Net cash flow from operations has been negative for three consecutive years. According to the unaudited operating data, in December 2021, the cumulative contract sales amount of Zhenro Real Estate together with the joint venture company and associated companies was about RMB 10,011 million.For the whole of 2021, the contracted sales volume of Zhenro and its subsidiaries is 145.643 billion yuan, compared with last year’s sales target of 150 billion yuan.In recent years, zhenro real estate scale has grown rapidly, from 10 billion to 100 billion only in 5 years.Zhenro was founded in 1998 and is controlled by Ou Zongrong.From the perspective of equity structure, Ou Zongrong, Ou Guoqiang and Ou Guowei indirectly hold 54.6%, 4.99% and 4.97% of the shares of Zhenrong Real estate respectively. Ou Guowei and Ou Guoqiang are all sons of Ou Zongrong.From 2016 to 2018, Zhenro Real Estate recorded contract sales of 39.292 billion yuan, 70.153 billion yuan and 108.017 billion yuan respectively, with a compound annual growth rate of 65.8%. In 2018, zhenro Real Estate joined the ranks of “100 billion club”.In the first half of last year, Zhenro Real Estate added 24 new plots of land with 3.56 million square meters of land reserve floor area. As of June 30, it had a total land reserve floor area of 29.3 million square meters.In the first half of last year, Zhenro Real Estate achieved revenue of 16.011 billion yuan, up 10.1% year on year;The net profit was 1.166 billion yuan, up 33.1% year on year.However, from 2018 to 2020, the net operating cash flow of Zhenro Real Estate continued to be negative, which was -2.664 billion yuan, -14.064 billion yuan and -3.018 billion yuan respectively in the past three years.As of June 30 last year, the net debt ratio of Jeonyoung Real Estate was 57.2%, and the debt-to-asset ratio excluding prepaid accounts was 72.4%. The ratio of cash to short debt was 2.2 times, which crossed the red line and was considered yellow.At the semi-annual results meeting, Zhenro real Estate announced off-balance sheet liabilities of $3.1 billion, off-balance sheet monetary funds of about $2.4 billion, and off-balance sheet net liabilities of about $700 million.