Yanlord Land    Last:0.65    -0.025

Yanlord - Long term debt SGD 7.15 billion !!!

It is not unusual for growing companies to take on debt to fund captial expenditures. As an share holder, i would rather my company fund its land acquistion by taking money from debt holders than share holders. 

Yes, debt is high but question is whether is Yanlord in a good position to manage them? 

Moody says " On the other hand, the company' s debt leverage &mdash as measured by revenue to adjusted debt &mdash weakened to
72% in 2017 from 102% in 2016, because of the high level of spending on land acquisitions during 2017. Its reported debt increased to RMB33.1 billion in 2017 from RMB22.7 billion in 2016, mainly due to its land payment for a few large development sites acquired in 2017 and 2H 2016. " Nevertheless, we expect that Yanlord' s debt leverage will recover gradually over the next 12-18 months, based on the moderation in land spending in 2018, and faster revenue growth during the same period"

Another question to ask is that, in the event of interest rate hikes, is Yanlord in a good position to handle them?

Moody says " Yanlord' s liquidity position is strong. At the end of 2017, its cash balance totaled RMB17.8 billion, covering
7.0x of its short-term debt. Its short-term debt to total reported debt fell to 8% in 2017 from 45% in 2016. The company' s cash on hand will be sufficient to cover its short-term debt and committed land payments over the next 12-18 months. Yanlord' s large cash buffer &mdash in particular, its cash to total debt of 54% as at the end of 2017 &mdash also cushions against its higher-than-expected leverage at 31 December 2017."

A companies with good capital structure will consist of funding from both share holders and debt holders. Even SIA, who was carrying 0 debt for many years, took on debt recently to fund further developments.

Chairman/CEO Zhong just purchased about SGD5M of his own company shares. He now owns close to 69% of Yanlord. I am sure a privatisation offer is not far away.

 

I thought this is good news for China property developers? IIRC, from one PRC developer chairman listed on the SGX, China' s property development tax is extremely high, like 50% of net/gross profit, and it' s based on profit margins. The bigger the profit margin, the higher the tax, which made some developers sell at a lower price than the market is willing to pay because a higher psm pricing will attract a much higher tax quantum. This probably explains why residential projects sell out so quickly and the queues were phenomenal - it' s underpriced.

Now they want to shift this huge upfront tax from the developer to the buyer/owner of the property via real estate tax.

He added that China' s own specific conditions will also be considered, such as necessary integration of some other taxes, and the reduction of tax burdens on the real estate development and trade. 

huathuat88888      ( Date: 07-Mar-2018 14:38) Posted: --- Post Removed by User ---

 

This one is one " no horse run" S-chip.

 

Sure err not $ 7.15 billion SGD long term debt still at 1.72 !!!!! Wakakaka.... LOL!!!!
plenty of space and room for those who wanna up lorry up lorry... lai lai lai...

buy buy but yan lord land good counter.. all the ah gong.... ah dai ah meow. Come come buy


hehe hehe 

DYODD probably. All assumptions above. 

 

Code: Z25

james87      ( Date: 08-Jan-2018 09:54) Posted: why I don?t see the counter on SGX

 

why I don?t see the counter on SGX

 

Yanlord has been trying to buy over Singapore property companies like UE, WBL Seems like Yanlord is afraid of the Chinese property market and wanted to diversify away from China. 

 

14-12-2017 04:05:00 DJ Investors Wary of China Developer Valuations, Property Supply -- Market Talk    0405 GMT - Most investors have trimmed their positions in the China property sector, says Credit Suisse, and are reluctant to re-enter at the current valuation given a lack of near-term sales catalysts. Still, CS points to Sunac, Shimao, Sino-Ocean and KWG as developers with stronger sales growth momentum. Instead of worrying about refinancing amid high gearing, most concerns lie on the supply side given the country' s stringent home price curbing measures, CS adds. Trading is mixed early Thursday. Evergrande and Sunac, the two 2017 highflyers, are up 0.6% and 2%. ([email protected])   (END) Dow Jones Newswires December 13, 2017 23:05 ET (04:05 GMT) Copyright (c) 2017 Dow Jones & Company, Inc.

 

There is a recent downgrade by Moody' s. Perhaps that explained why share priced has down so much last few weeks. 

 

Yanlord better pray that interest rates dont zoom up too much next year.