A court ordered scandal-plagued Kangmei Pharmaceutical Co. to pay almost 2.5 billion yuan ($385 million) to more than 50,000 investors as compensation for their losses on the company’s stock, Caixin reported. The court ruled Friday in China’s first class-action lawsuit against the company. The Guangzhou Intermediate People’s Court found the drugmaker, its executives and auditors responsible for financial fraud that caused 2.46 billion yuan of losses to 52,037 investors, the court said.
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China’s economy performed better than expected in October as retail sales climbed and energy shortages eased, partly offsetting a slump in property, Bloomberg News reported. Industrial output rose 3.5% in October from a year earlier, while retail sales growth accelerated to 4.9%, beating economists’ forecasts. Growth in fixed-asset investment eased to 6.1% in the first 10 months of the year, compared with a forecast of 6.2%. The surveyed jobless rate was steady at 4.9%.
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Indebted real estate group China Evergrande avoided at the last minute a destabilizing default for the third time in the past month, with a source claiming on Thursday that several bondholders had received late coupon payments, Market Research Telecast reported. Evergrande, the world’s most indebted real estate developer, has stumbled between payment terms in recent weeks as it tries to cope with more than $ 300 billion in liabilities, 19,000 million of which are bonds issued in international markets.
The personal luxury market of high-end accessories, leather goods and apparel has snapped back to pre-pandemic levels as U.S. shoppers outspent those in China in pursuit of the latest fashion trends, according to a study released Thursday by the Bain consultancy, the Associated Press reported. Global consumer spending on personal luxury goods, including the latest sneaker trend or design collaboration, is forecast to spike by 29% this year, to 283 billion euros ($325 billion).
China Evergrande Group looks set to avert another default in its biggest test since the property developer’s debt crisis began, Bloomberg News reported. Customers of international clearing firm Clearstream received overdue interest payments on three U.S. dollar bonds issued by Evergrande, a spokesperson for Clearstream said. Two investors that hold two of the bonds confirmed that they received the payments, asking not to be identified because they weren’t authorized to speak publicly.
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Chinese developers’ bonds and stocks rallied on a report that authorities are likely to loosen controls for the nation’s real estate companies to issue local-currency notes, part of efforts to prevent a further deterioration in their financing, Bloomberg News reported. The Securities Times said that the easing will center on the interbank bond market, which has seen issuance from developers fall in the past year.
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A growing number of cities in China have tightened supervision over the use of presold property proceeds, a move likely to deepen the cash crunch at many of the country’s real estate developers that have relied on the inflows as a key source of funding, Bloomberg News reported. Major cities including Beijing, Tianjin and Shijiazhuang as well as smaller municipalities like Suzhou and Nantong in the eastern province of Jiangsu, and Luohe in central Henan province have issued rules tightening oversight of the proceeds, according to a China Business News report and government statements.
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Chinese property developer Kaisa Group Holdings Ltd. plans to speed up asset disposals to meet investor obligations, after the indebted company missed a payment on a wealth-management product last week, the Wall Street Journal reported. The Shenzhen-based company has sufficient “high-quality assets” it can tap to make the payments, Kaisa said in a statement on its website late Monday, adding that it would seek to sell assets in Shenzhen, Shanghai and other places.
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Sino Ocean Group Holding Ltd., part-owned by the finance ministry, has become the latest property company to see its bonds slump. Its 4.75% note due 2030 fell Monday to as low as 73.48 cents on the dollar, with spreads over comparable Treasuries widening to a record 800 basis points, according to data compiled by Bloomberg. That’s despite the firm being rated investment-grade at two global credit assessors and holding about 54 times more cash and equivalents than China Evergrande Group. Sino Ocean’s shares have been doing better, rebounding 35% from their September low. They rose 3.5% Monday.
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Kaisa Group Holdings Ltd. plans to sell property assets valued at almost $13 billion to raise capital after the cash-strapped Chinese developer flagged liquidity stress and missed payments on investment products, Bloomberg News reported. The company has put 18 projects covering 1.45 million square meters (15.6 million square feet) in Shenzhen up for sale, with a total value estimated at 81.82 billion yuan ($12.8 billion), according to people familiar with a briefing by Kaisa’s executives to retail investors on Thursday.
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