With the Chinese Real Estate Market Reshuffling, Li Ka Shing Intends to Purchase New Shares

BEIJING -

On Oct. 21, there was news from the Hong Kong capital market that Evergrande Real Estate Group (Evergrande), a large Chinese real estate company that recently went public with a share offering, has attracted active subscription in the amount of several hundred million US Dollars by Chinese millionaires, including Zheng Yutong, Luanxiong and Li Ka Shing who had not invested in new shares for a long time. According to the Sales Rankings of Chinese Real Estate Companies for Q3 2009 released on October 9th by CRIC (China) Information Technology Co., Ltd, in cooperation with China Real Estate Appraisal and Shanghai E-house R&D Institute, Evergrande ranks number one in five listings, including in floor space sold for the first three quarters, sales revenues and land reserves at the end of Q3. Sina Leju, the first media source to announce the release of the sales rankings, reports more information concerning Evergrande, part of which is as follows.

Xu Jiayin, Chairman of the Board of Directors of Evergrande, went to Hong Kong during this year’s National Day holidays. He was not vacationing, but preparing for the global road shows for Evergrande’s IPO and the official listing scheduled for October and November respectively. According recent market news, Evergrande, which is preparing to go public in the Hong Kong market, has become popular and attracted subscription by Chinese millionaires Zheng Yutong, Luanxiong and Li Ka Shing in the amount of several hundred million US Dollars immediately after its share offering.

According to another insider close to the underwriting group, Evergrande’s international distribution was twice the subscription. Many industry experts commented that although some mainland real estate companies were confronted with the awkward situation of their stock prices sinking below IPO price when they went public in the Hong Kong market, Evergrande’s subscription showed that well-known real estate companies with prime assets can be recognized and favored by investors as prices of Hong Kong shares rise.

As a black horse in the market, Evergrande’s has taken a leading position. According to CRIC’s statistical data, in Q3, 2009, Evergrande realized sales revenue of RMB12.33 billion, RMB300 million more than that of Vanke, which was ranked the second; its sold floor space amounted to 2.303 million square meters, 840,000 square meters more than that of the second place holder. In terms of sales growth for Q3 and the first half of 2009, Evergrande doubled the growth of both sold floor space and sales revenue.

Meanwhile, in terms of nationwide land reserves, Evergrande ranked number one with land reserves of 51 million square meters. Country Garden ranked second with land reserves of 43.6 million square meters. Vanke and Poly ranked ninth and tenth respectively. Some industry insiders have speculated that Evergrande’s performance represents the biggest change in the Chinese real estate market this year. In the context of fierce competition among real estate companies, the positions of some well-established real estate developers are being challenged as some emerging companies, such as Evergrande, Poly, and China Overseas Property, are developing rapidly.

Some industry insiders commented that Evergrande’s top sales performance can be attributed to its strategy of rapid development and cost control. According to statistics, the average price of its residential projects is RMB5,354 per square meter, up slightly from RMB 5,318 per square meter, which was the average price in the first half of this year.

For more information, please contact: Kevin Fax: +86-10-5895-1005 Email: Kevinmts@sina.com

Source: Sina Leju

Kevin, +86-10-5895-1005 (Fax), or Kevinmts at sina.com