Greenland China (00095) defaults on promissory notes without announcement, the market is worried that the company may have hidden default risks.

A commercial bill guarantee by the Hong Kong-listed company Greenview CHINAPROPERTIES (00095) due on January 2nd has defaulted. It is reported that the investors of the bill have sent a letter through a representative agency to demand that Greenview China take responsibility for the guarantee. On January 8th, Greenview China's stock plummeted significantly during trading, dropping more than 10%, reflecting market concerns that this default could lead to further liquidity crisis for the company. However, as of now, Greenview China has not announced any information regarding the default on this bill. The company's stock price has been declining since mid-November, with a decrease of over 56% from November 8th until now, causing concerns in the market about whether its liquidity will have a direct impact on the company's other debts. The defaulted bills issued by Baoshi International Limited on January 2, 2024, involve multicurrency bills totaling 114 million Hong Kong dollars LVGEM 8 01/02/25 (XS2738072094), 5.278 million US dollars LVGEM 8 01/02/25 (XS2738082218), and 40.5 million Renminbi LVGEM 8 01/02/25 (XS2738064158). These bills are all guaranteed by Greenview China. According to the terms of issuance, Greenview China has unconditionally and irrevocably guaranteed the issuer's payment of all amounts due under the bills. In the event of default, the holders can issue a written notice to the issuer and guarantor to demand immediate payment of the principal and interest. From the perspective of default and cross-default rules of listed companies, this default by Greenview China on the bonds may have a significant adverse impact on its operations. Nevertheless, as of now, Greenview China has not repaid the bills. At the same time, Greenview China has not released any default announcements through the listed company platform as required by market regulations. It is worth noting that the personal guarantee for the defaulted bills belongs to Huang Kangjing, the actual controller of Greenview China. If this default is taken to court, both Greenview China and the actual controller may face adverse consequences. Urgent liquidity situation? In recent years, Greenview China has been facing significant debt repayment pressure. In early 2022, Fitch Ratings downgraded Greenview China's long-term foreign currency issuer rating to "B-" with a "negative" outlook, citing liquidity tightness and refinancing risks. Greenview China has acknowledged in multiple disclosures that it faces temporary liquidity pressure and will take measures such as refinancing, extending existing loans, and adjusting sales strategies to alleviate pressure. In its 2024 interim report, Greenview China again mentioned its efforts to improve liquidity and minimize operational risks. To quickly recover funds, in the first half of 2024, Greenview China sold part of the commercial and parking spaces in the Rainbow Bay Shopping Center and leased back the property and parking spaces. The assets, with a book value of close to 1.3 billion yuan, were sold by Greenview China for 814 million yuan, resulting in a loss of nearly 400 million yuan. As of June 30, 2024, Greenview China held 4.27 billion yuan in bank deposits and cash, while its total liabilities had risen to 77.154 billion yuan year-on-year, with an asset-liability ratio climbing to 73.5% and a net debt ratio reaching 277.44%. Looking at its financial data, the company's short-term debts due within a year amount to 17.053 billion yuan, far exceeding its cash on hand. From an operational perspective, influenced by the overall economic environment and industry development, Greenview China's operations have been on a downward trend in recent years. The company has been recording annual losses since 2022, with a loss of over 2.1 billion yuan in 2023. In the first half of 2024, although Greenview China's revenue saw a year-on-year increase, its gross profit margin decreased significantly. The company reported a loss of 1.61 billion yuan for the six-month period, a significant increase from the 580 million yuan loss in the previous year. Significant funding still needed for project development Greenview China is the developer of the Shenzhen Greenview Baishizhou project, the largest urban renewal project in the country. In the first half of 2024, the Phase One project of Greenview Baishizhou was an important source of real estate sales revenue for Greenview China. However, the overall sales situation of the Greenview Baishizhou project is not ideal in the current market environment. In addition, the project recently had issues with the syndicated loans, with reports of delayed distribution of relocation compensation to villagers. As early as the first half of 2022, in order to address the liquidity crisis, Greenview China introduced Vanke as a strategic shareholder, injecting 2.3 billion yuan into the Baishizhou project and transferring the dividends of the third and fourth phases of the Baishizhou project to Vanke. Although the Phase One project of Greenview Baishizhou started selling in September 2023, according to regulatory requirements, the sales funds need to be used for project progress payments, rather than for the company's daily expenses or repayment of other debts. Moreover, with the project not yet completed, substantial funding will still be needed in the future. According to plans, Greenview China will also promote the completion of various projects in the following phases, such as the commercial sector of Greenview Baishizhou Phase One, the Nanshan Foreign Language Education Group Baishizhou School, and parts of Greenview Baishizhou Phases Two, Three, and Four. The default on this bill has raised concerns in the market about a potential explosion in Greenview China.If Green Land China cannot solve the liquidity problem in a timely manner in the future, it may bring significant uncertainty to the overall operation.Bonjour, comment a va aujourd'hui?