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Tightened lending curbs in the real estate industry early this year has exacerbated financial troubles at some property developers, triggering sector-wide liquidity stress.
China Evergrande, one of the country’s biggest developers, has struggled to make payments on billions of dollars worth of bonds, while smaller peers have likewise missed payments or had their credit ratings downgraded.
On Thursday, liquor and meat producer Beijing Shunxin Agriculture Co Ltd said it planned to sell its entire stake in a money-losing property unit.
The announcement came two weeks after liquor product maker Hainan Yedao Group Co Ltd said it would sell its 40% stake in a property company to focus on core businesses and improve liquidity.
Dozens of China-listed companies, including Xiamen ITG Group Corp Ltd, Aoyuan Beauty Valley Technology Co and Zhangtian Financial Group Co Ltd have announced plans to dispose of property businesses so far this year, the state-run Securities Times reported.
Reflecting the real estate sector’s liquidity crunch, data from the China Trust Association showed outstanding investment from trust firms fell below 2 trillion yuan ($313.66 billion) at the end of the third quarter, down 26% from a year earlier.
($1 = 6.3763 Chinese yuan renminbi)
