Hong Kong builder Emperor shares drop after it says debt overdue
The real estate firm had more than HK$16.6 billion (S$2.7 billion) overdue as at Mar 31 'and/or the Group has breached certain terms of the loan agreements', according to a filing to the Hong Kong stock exchange late Friday. 'The banks may request immediate repayment of these bank borrowings,' the company said in the filing.
Its shares-which trade at penny stock levels-dropped as much as 16 per cent in Hong Kong on Monday morning, the biggest intraday decline since August 2024. They later pared some of the losses to HK$0.21 per share.
A years-long property crisis in China has increasingly pressured Hong Kong developers, from bigger indebted builders such as New World Development to smaller ones, including Emperor. Property prices in the city have fallen around 30 per cent over the past four years, and are now around a nine-year low, as banks tighten credit lines.
Emperor International also reported a widening loss of HK$4.7 billion in the year ending end of March.
'Some cash-strapped Hong Kong developers could leave banks in a tight spot unless they urgently raise cash or ask lenders for leniency.' Bloomberg Intelligence analysts Patrick Wong and Francis Chan wrote in a note on Monday. 'Falling Hong Kong property prices risk forcing banks into write downs if distressed loans pile up.' BLOOMBERG
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