A total of 815 listed companies on the Shanghai and Shenzhen stock exchanges have announced their mid-year earnings forecast, and less than half of them predict they will be profitable in the first half of fiscal 2009.
The real-estate sector, however, is bearing up well. For example, China Merchants Property Development, one of the bigger real estate companies, has posted a 125% year-on-year increase in net profit, to an estimated RMB4.5 to 4.9 billion for the first six months of 2009. In the first half of 2008, the property development company realized a total of RMB219 million in profit.
Although Vanke, the barometer of China’s property market, has not issued an earnings forecast, reports of the brisk sales of apartments it has developed have impressed investors.
According to a latest report on property sales, Vanke maintained the top slot in gross floor area sales, with Poly Real Estate Group and Hengda Real Estate following. The same report said the top 20 property developers sold a total of nearly 6 billion square meters of gross floor area worth RMB6 billion nationwide.
Stock analysts predicted real estate developers’ earnings would grow even faster in the second half due to escalating property prices in the major cities, especially Beijing and Shanghai.
China Daily reported the land price record was rewritten four times in less than two months, with a piece of land auctioned for RMB4.06 billionin the capital, making it the most expensive property in the country.