Source |IC photo
Following the double-killing situation of stocks and bonds on September 28, Xuhui Holdings once again experienced a decline in bond prices and a downward rating.
htmlOn October 12, Fitch lowered Xuhui Holdings' long-term issuer default rating and its advanced unsecured rating from "BB-" to "CC".Fitch said the downgrade reflects the liquidity risk of Xuhui . Fitch believes that Xuhui may not be able to use capital market financing in the medium term, and expects that the company will rely on available cash and internal cash flow to repay maturing debts during the rest of the year and in 2023.
On October 12, "20 Xuhui 01" fell by more than 14%, "21 Xuhui 03" fell by more than 11%, "21 Xuhui 01" fell by more than 6%, and "21 Xuhui 02" fell by more than 17%.
Fitch expects that Xuhui will need to repay approximately 20 billion yuan of capital market maturing debts and overseas syndicated loans in 2023.
Fitch stated in its rating report that Xuhui failed to repay its debts as scheduled, and the liquidity that the company can use to repay debts may not be sufficient to cover its debts due in the short term. Xuhui refused to issue a written statement to Fitch and did not provide additional information to Fitch except for issuing the announcement, so Fitch was unable to verify the above-mentioned failure to pay interest on time.
htmlOn October 11, market reports pointed out that at least two public bonds in Xuhui did not pay interest on time - including one convertible bond and another overseas loan. The company had previously sought extension but had not received grace. htmlOn October 11, "21 Xuhui 02" was temporarily suspended during the afternoon trading session and replied to the transaction after more than 1 hour. The bond issuance of 3 billion yuan, with a term of 5 years and a face rate of 4.2%. htmlOn September 28, the stock price of Xuhui Holdings Group fluctuated abnormally. On the evening of the same day, the company issued a voluntary announcement on the Hong Kong Stock Exchange to clarify the news that the market was unable to repay its due debts.The above announcement points out that it involves equity trust products issued by a financial institution. Xuhui clarified that the funds raised by the equity trust product were financing a property development project in the group located in Tianjin. Affected by the local real estate market conditions, the development and sales progress of the project is affected, which in turn affects the cash distribution of the trust product.
Another letter about Xuhui internally mentioned that the group's cash amount in the account exceeds RMB 30 billion and its purpose. Xuhui Group stated that the internal letter mentioned that the group's cash amount in the account is an unaudited amount, and most of it is funds related to the development of the group's real estate business project, including restricted pre-sale funds deposited by the group in designated bank accounts in accordance with applicable Chinese laws and regulations to ensure the development and delivery of the group's real estate business project.
In addition, the statements in this internal letter are only factual statements that restrict the use of restricted pre-sale funds in accordance with applicable laws and regulations. For the avoidance of doubt, the statements in this internal letter do not imply or express that the Group is unable to repay its due debts or pay off its debts.
Author | Song Hongshan
