Chinese Property Stocks Surge on Mortgage Lending, Open Market Bond Sales
Liao Shumin
DATE:  Nov 11 2021
/ SOURCE:  Yicai
Chinese Property Stocks Surge on Mortgage Lending, Open Market Bond Sales Chinese Property Stocks Surge on Mortgage Lending, Open Market Bond Sales

(Yicai Global) Nov. 11 -- Chinese property-related stocks surged today as investors took cheer from positive news this week that mortgage lending has jumped and domestic bond policies look likely to be relaxed.

A number of real estate stocks hit the upper 10 percent daily limit, including Tahoe Group [SHE: 000732], China Merchants Shekou Industrial Zone Holdings [SHE: 001979], Poly Developments and Holdings Group [SHA: 600048], and Gemdale [SHA: 600383]. Many others also climbed more than 9 percent.

The gains follow figures from the People’s Bank of China yesterday showing that lenders have stepped up the issuance of real estate loans. The balance of personal mortgages with banks was CNY37.7 trillion (USD5.9 trillion) last month, an increase of CNY348.1 billion over the month and CNY101.3 billion from September.

Analysts at Citic Securities believe that property sales receipts are expected to improve significantly as mortgage lending continues to rise from this month. Sales are likely to increase across the market next March, it said.

On. Nov. 9, the National Association of Financial Market Institutional Investors held a meeting with representatives of real estate companies, Yicai Global learned from participants, at which many revealed plans to issue debt in the inter-bank market soon. Those in attendance included China Merchants Shekou, Poly Developments, Country Garden Holdings, Longfor Group, Jiayuan Chuangsheng, and Midea Real Estate Holding.

The NAFMII meeting means policies on domestic real estate companies’ bond sales will be relaxed, Securities Times reported, citing bond traders. That means property developers will sell bonds in the open market in the near future. Institutional investors such as banks will also re-finance them through bond investment to prevent further deterioration of their capital chains, the report added.

The shares of companies in building materials, home furnishings, and home appliances also soared today. Among suppliers of building materials, Huaxin Cement [SHA: 600801], Beijing Oriental Yuhong Waterproof Technology [SHE: 002271], and Monalisa Group [SHE: 002918] each hit the daily upper limit.

Among home furnishers, Zbom Home Collection [SHA: 603801] rose over 8 percent, while Jason Furniture Hangzhou [SHA: 603816] gained more than 7 percent. Integrated cooker maker Marssenger Kitchenware [SHE: 300894] surged more than 14 percent and Hangzhou Robam Appliances [SHE: 002508] jumped over 7 percent in intraday trading.

Editor: Peter Thomas

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Keywords:   Real Estate