“Land King Harvester” Greentown Sees Profits Plunge 90% to RMB 210 Million as “Survival Becomes Paramount”

In March, one day before releasing its 2024 annual results, Zhang Yadong abruptly resigned as Executive Director and Chairman of Greentown China, ending his seven-year tenure. The sudden departure left the board without a successor, prompting a brief trading halt. On March 26, 2025, Greentown confirmed that Liu Chengyun—long a senior executive at its major shareholder China Communications Construction Group—would assume the chairmanship.

Under Zhang’s leadership, Greentown pursued aggressive land acquisition to drive scale, enhancing its brand and industry standing. However, as China’s property sector cooled, vast land holdings and unsold units began to erode profitability. The company Liu now leads posted H1 2025 revenue down 23.3% year-on-year and net profit attributable to shareholders collapsing 89.7% to just RMB 210 million.

Inventory Becomes a “Cash Monster” as Partners Claim Over RMB 1 Billion in Profits Greentown’s interim report shows total contracted sales of RMB 122.2 billion, with RMB 80.3 billion from self-developed projects—a 6% decline. Despite a 22.7% drop in recognized area due to uneven delivery schedules, the company ranked fifth in CRIC’s H1 2025 full-caliber sales list. Revenue fell to RMB 53.368 billion, down RMB 16.2 billion year-on-year. Management remains optimistic about matching 2024’s annual revenue.

Profit, however, plunged. H1 net profit was RMB 1.211 billion, down 63.5%, and after joint-venture allocations exceeding RMB 1 billion, shareholder net profit stood at RMB 210 million—a staggering 89.7% drop. This reflected RMB 1.933 billion in impairment provisions linked to long-held inventory. As of June 30 2025, completed unsold properties totaled RMB 38.6 billion, and total inventory value reached RMB 270 billion—half dating from 2021 or earlier. Greentown wrote down RMB 1.717 billion in H1—eight times its net profit—underscoring the toll of unsold stock on earnings.

Land Acquisition Target of RMB 160 Billion Fuels “Land King” Pursuit At its 2024 results briefing, Greentown set a 2025 sales goal of RMB 160 billion for self-developed projects. In H1 2025, it added 35 new projects—up from 15 last year—with 3.55 million sqm of gross floor area and RMB 90.7 billion in land value, ranking third industry-wide. In June, Greentown paid RMB 27,900/sqm for a Wuhan Jiang’an District plot at a 54.36% premium—becoming the district’s new “land king.” H1 land payments reached RMB 36.2 billion, up 135%.

CEO Guo Jiafeng attributed the spree to high-quality land supply in cities like Hangzhou but signaled a more cautious H2 amid uneven conditions. Yet Greentown continued aggressively: in July it set Suzhou records at RMB 65,242/sqm and paid RMB 126,600/sqm for Shanghai North Bund—both new “land kings.” Guo defended these bids as calculated moves, citing sustained demand for premium, low-density plots even as the broader market adjusts.

Rising Debt and Financing Costs Make “Survival” the Top Priority To support expansion, Greentown ramped up financing. Domestically, it issued nine bonds and notes in H1 2025, raising RMB 7.711 billion, including RMB 5.5 billion in 2–3-year credit bonds and RMB 2.211 billion in 1-year supply-chain ABN. Offshore, it refinanced USD 802 million and issued USD 500 million in senior notes—the first Chinese developer dollar debt since February 2023.

By June 30, total borrowings stood at RMB 143.027 billion, with bank loans of RMB 116.9 billion. Its weighted average interest cost of 3.4% tops the industry, pushing net-debt-to-equity to 63.9%. Management acknowledges high leverage but remains committed to gradual debt reduction. With self-funded projects straining the balance sheet, Greentown is expanding its asset-light construction-management business, targeting RMB 100 billion in contracted sales—over 60% of its self-developed goal. Yet intensified competition drove H1 service revenue down 17% to RMB 1.361 billion, compressing margins.

Executive President Geng Zhongqiang summed up the view: “Survival is more important than anything; staying in business is the foundation for future development.” The question now is how Greentown will not only endure under new leadership but thrive going forward.