AFP – Chinese real estate giant Vanke’s profit fell 46 per cent in 2023, the company said yesterday, as the country’s property market grapples with an unprecedented crisis.
Vanke is one of China’s top property developers and was the sector’s second-largest firm in terms of sales last year, according to specialist firm CRIC.
However, the market is facing major financial challenges, with some developers on the verge of bankruptcy and lower property prices deterring consumers from making investments.
Vanke reported a net profit of CNY12.16 billion (USD1.68 billion) last year, down 46.4 per cent from 2022, according to a Hong Kong stock exchange filing yesterday.
“The company’s profits are under pressure, and indicators such as capital stock and cash-to-short-term-debt ratio are on the decline,” the company said in the filing.
Moody’s, S&P and Fitch all downgraded their ratings for the embattled real estate firm this month, warning that economic conditions will continue to weigh down its performance.
Vanke’s largest shareholder, Shenzhen Metro, is wholly state-owned, which was once seen as a guarantee of financial stability.
Recent setbacks make it the latest Chinese developer to be caught up in a mounting real estate sector crisis, on the heels of Evergrande and Country Garden.
