Adds detail on degradations, stock and bond prices, the context
September 8 (Reuters) – Fitch Ratings downgraded China Evergrande Group ratings 3333.HK and two of its subsidiaries on Wednesday, the latest in a series of downgrades targeting the indebted real estate company.
In a statement, Fitch said it downgraded the long-term default ratings of foreign currency issuers from Evergrande and its subsidiaries Hengda Real Estate Group Co and Tianji Holding Ltd to CC from CCC +. Fitch defines a CC dimension as indicating “Very high levels” of credit risk.
Fitch also downgraded the senior unsecured ratings of Evergrande and Tianji, as well as the rating of the senior unsecured bonds guaranteed by Tianji issued by Scenery Journey Limited to C by CCC.
“The downgrade reflects our view that some default seems likely. We believe the credit risk is high given tight liquidity, declining contract sales, pressure to address late payments to suppliers. and contractors and limited progress on asset disposals, “Fitch said in the declaration.
TThe move comes after Moody’s Investors Service and the national rating agency China Chengxin International also downgraded Evergrande’s ratings in recent days.
Evergrande shares fell 3.08% at the start of trading on Wednesday before cutting losses. China Electric Vehicle Company Evergrande New Energy Vehicle Group Ltd 0708.HK fell ten%.
The price of Evergrande bond traded in Shenzhen in May 2023 CN149128 = SZ slipped 0.57% Wednesday morning to 34.8 yuan.
The bond’s price has fallen nearly 50% since a downgrade of Evergrande by China Chengxin International last week made the company’s onshore bonds ineligible for use as collateral in financing deals. retirement.
(Reporting by Kanishka Singh in Bangalore and Andrew Galbraith in Shanghai; Editing by Muralikumar Anantharaman and Ana Nicolaci da Costa)
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