Thread by @ssinvestments8

China property market thread #China #RealEstate

1/6 - Base case default rate is 19%. Bull case is 10%...

@GoldmanSachs

2/6 - 60% of property HY bonds are trading below $40.

@HSBC

3/6 - not it's first crisis ever. And was also policy-driven in most cases.

@HSBC

4/6 - it has come through many ups and downs in the past two decades.

@jpmorgan

5/6 - but this time around, the secular outlook is pretty dire...

@jpmorgan

6/6 - factoring all that in, the sector's equities have come down by half with PE 4x to 5x and PB 0.6x to 0.7x... with many top 30 industry players below 0.15x PB

7/N - the maturity wall at a glance. March and April are also uneasy.

Source: @GoldmanSachs

Once fiscal conditions are on the hook, it won't be easy to come off. There's a limit to regulatory tightening and speed to clean up debt.

Shadowy China Firms Spend Billions on Land Shunned by Developers bloomberg.com/news/articles/…

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