Author | Cat Brother
Source | Big Cat Finance
"The company's free use of monetary funds has basically dried up."
The person who said this is Sunshine City (000671.SZ), a 100 billion real estate company. The translation is: has no money.
In 2021, Sunshine City ranked 19th on the sales list with an amount of 183.81 billion. Although ranked lower than in previous years, it still ranked among the Top 20.
html With sales of more than 3.18 trillion, why is there no money?
Recently, they first announced their performance forecast, has a forecast loss of 4.5-5.8 billion in 2021, and ranks fourth on the A-share real estate company’s forecast loss list.
followed by , two US dollar bonds defaulted, 27.2625 million US dollars (approximately 172 million yuan) in interest was not paid, ht The 172 million of ml3 is just a lead. The cross-default that will face behind the credit bonds is the real thunder. Once cross-defaults, Sunshine City, which is standing on the edge of the cliff, may really be pushed down.
Moreover, it is followed by the peak of debt repayment.
According to Sunshine City’s announcement, at the end of the third quarter, the balance of interest-bearing debt was 84.938 billion, and the debt within 32 years was 61.366 billion.
Now the interest of 172 million is still not enough. It can be said that we are standing on the edge of a cliff. Can we still see the sunshine?
They have a lot of assets, but one-third of the assets have been used for financing and cannot be moved;
has unrestricted inventory, has a lot of houses under development, It's just that many houses are sold at discounts and are not easy to sell, and the repayment speed of the sales is very slow;
has 27.18 billion in monetary funds in the account, but the cash also includes loan deposits, mortgage deposits, etc., and the funds used for spiritual activities do not exceed 1%. In other words, has no more than 270 million in cash in hand.
If you pay the interest on the US dollar debt, Sunshine City will really have no money.
Running out of cash is really not just talk.
Sunshine City started relatively early.
Boss Lin Tengjiao was born into a family of returned overseas Chinese. In 1995, after studying in Singapore, he returned to Fuzhou and founded Fujian Sunshine Group. The first real estate project "Yanghong New City" was developed the next year.
Lin Tengjiao's family is relatively wealthy, and he belongs to the "if you don't work hard, you will go back and inherit the family property" type, but he is willing to go out and try his luck.
In 2002, Lin Tengjiao acquired the listed company Shishi Xinfa, which later became Sunshine City. Real estate was the main business, but it has been tepid. Then he went into agriculture and trade. At one time, seeds sold better than houses.
It was not until 2009 that the real estate business of Sunshine City ushered in a rapid development. Net profit exceeded 100 million. In 2012, Lin Tengjiao changed the Sunshine Group from Fujian to Shanghai, and relied on three "poachings" to make the company develop rapidly.
- Longhu general Chen Kai, management is also very powerful, has achieved 10 times growth in two years. In 2013, Sunshine City officially entered the top ranks of national real estate companies with sales of 22.02 billion, ranking 29th.
- Digging Vanke important minister Zhang Haimin, doubled in three years.
- dig Country Garden core figures Zhu Rongbin and Wu Jianbin , officially learned Country Garden’s high turnover model, is called “Little Country Garden” in the industry.
Lin Tengjiao’s highlight moment with Sunshine City was in 2017.
"Being the boss" seemed to be Lin Tengjiao's obsession, so he became a merger maniac, In that year, His Sunshine Holdings bought and sold all the way. successfully obtained the control rights of listed company Longjing Environmental Protection . It cost a lot of money, but it was worth it. Sunshine Holdings doubled Lin Tengjiao’s worth.
It was also in this year that Sunshine City officially gave up trading, and completely entered the real estate boom mode. The "Country Garden + Sunac Sunac" model is really easy to use. Sunshine City's sales almost doubled in 2017, exceeding 90 billion in one fell swoop. officially entered the Fortune Global 500, and Lin Tengjiao himself became a rising star on the rich list.
Lin Tengjiao, who is in the limelight, has made a three-year plan. The scale of will exceed 150 billion in 2018, 250 billion in 2019, and 350 billion in 2020. What about
actually? did not meet expectations, but it is not too bad:
exceeded 150 billion in 2018;
although it did not reach 250 billion in 2019, On the sales list, has also reached its peak of 13th place;
In 2020, Sunshine City welcomed Taikang Insurance, a blessing of insurance capital. In addition to an investment of more than 3 billion, 's confidence boost is also very important.
crashes suddenly.
In October 2021, two directors assigned by Taikang , , voted against Sunshine City’s third quarterly report. People also have reasons - the revenue and net profit in the semi-annual report still have an increase of about 20%. is thriving. How come the deduction of non-net profit in the third quarter report turns into a loss of 1.75 billion?
's performance suddenly changed, Taikang, who had expected to make money, felt very uncomfortable.
In fact, shortly after Taikang entered the market, Sunshine City defaulted on 200 million commercial notes. Although it was later reconciled, the debt problem has already exposed the tip of the iceberg.
After Taikang personally exposed the "performance thunder" in the third quarter report, everyone immediately became alert because Sunshine City has a debt of 300 billion and an interest-bearing debt of more than 100 billion. If there is no money to pay back, it will be a big thunder.
Many financial institutions broke out in a cold sweat. After learned the information, many banks came to ask for money overnight, and Sunshine City's financial crisis immediately escalated.
Then why is the money gone?
The reason is not difficult to understand. is crazy about increasing leverage in the context of a tightening environment. As supervision becomes stricter and policies are adjusted, the speed of cash flow cannot keep up with the amount of debt repayment. can only continue to lose money and then default.
Why should we continue to increase leverage?
Because the bosses and shareholders have too much desire to make big money, although they have been clamoring for housing rather than speculation for many years, they all seem to think there is nothing wrong with .
Taikang’s original money was not in vain. There is a condition for betting on , which is that the total net profit attributable to the parent company in the next 10 years will be close to 100 billion.
But this net profit is Sunshine City's Achilles' heel. In the past 10 years, 's revenue has increased 25 times, but profits have only increased 15 times. The profit margin has not been high. However, to maintain growth in the past few years, relied on low-priced land reserves obtained in the past.
Taikang’s 100-billion-dollar bet requires an average annual net profit of nearly 10 billion. Sunshine City’s highest profit was 2020, only 5.2 billion. The conditions for the bet cannot be fulfilled at all. What should we do? can only work hard, acquire land crazily, build crazily, sell houses crazily, without making any mistakes in the middle.
Everyone knows that is exactly the opposite of the current market situation, and the results of can be imagined.
From secretly breaching the contract to officially admitting that the funds were exhausted, Lin Tengjiao had to stake his own fortune for Sunshine City. Equity pledges, debt extensions, and asset sales were all included.
A while ago, he resigned as a director of Industrial Bank . The next day it was reported that Industrial Bank had made large transactions in the secondary market. The market speculated that Lin Tengjiao himself might be the one selling shares.
Taikang’s negative vote is just the beginning.
Not long after, Zhu Rongbin, the professional manager who led Sunshine City to reach hundreds of billions, sadly resigned. cashed out stocks and suffered heavy losses. still paid 40 million after working for 4 years. still had some restricted shares, and failed to unwind.
Taikang seems to have little hope. It has started to reduce its holdings and liquidate its positions since the end of last year. ’s 10-year bet conditions were soon invalidated. After this, Taikang lost more than half. can be regarded as willing to accept defeat.
Ordinarily, insurance funds are long-term funds, and Taikang’s investment capabilities are also well-known in the industry. This investment only lasted for more than a year, so why did you admit your loss?
I can only say that has high short-term risks and is not promising in the long term.
The important investment property in real estate stocks is insurance capital. The two parties are quite compatible, but since 2021, insurance capital has reduced its holdings in many A-share real estate companies.
Everyone Life used to be the second shareholder of Gemdale Group . held 20.43% of the shares. After many reductions of shareholdings, only had 5.43% left.
Financial Street was reduced by Harmony Health and DaJia Life Insurance many times. Fubon Life, which held only a small shareholding, simply reduced its holdings and disappeared from the top ten shareholders in the third quarter report.
China Life sold a lot of Vanke A's shares, and currently has less than 1%.
Ever since China Fortune Land Development was hit by thunderstorms, risk aversion has spread from insurance funds. Ping An failed to invest in China Fortune Land Development, made a provision for asset impairment of 35.9 billion. This lesson is too scary, Therefore, when investing in real estate companies, insurance funds are more cautious.
When Taikang sold the equity of in Sunshine City, it spent 500 million to buy the project company of OCT, which owns the 123-3 Pujiang land in Minhang District; when Harmony Health sold the Financial Street, it spent 9.06 billion to acquire Beijing SK Building.
I hold land and houses, but I have something in my hands. I hold real estate stocks, but the money is gone.
