(The following statement was released by the rating agency)
Jan 29 - Fitch Ratings says in a new report that it expects the homebuilding sector in China to see rising volumes in 2013 due to improved funding availability to developers and increased regulatory certainty. Year-on-year increases in the first half of 2013 will be higher than in the second half, due to comparison with weaker sales registered in H112.
Fitch expects home purchase restrictions (HPRs) to remain in place, as the Chinese government continues to try and curb excess price increases. However, over the long-term, the sector’s growth will continue to be underpinned by urbanisation and rising household income.
The report also highlights that polarisation of the sector will remain acute with large operators benefiting from their strong financial position and substantial scale, and smaller players continuing to be challenged by limited financial and operational flexibility. As a result, smaller homebuilders are more vulnerable to an environment of low liquidity and tight regulation.
Currently Fitch rates the following companies:
Beijing Capital Land Ltd. (‘BB+'/Stable)
China Aoyuan Property Group Limited (‘B+'/Stable)
Evergrande Real Estate Group Limited (‘BB’/Stable)
Franshion Properties (China) Limited (‘BBB-'/Stable)
Future Land Development Holdings Limited (‘B+'/Stable)
Global Logistic Properties Limited (‘BBB+'/Stable)
Hongkong Land Holdings Limited (‘A’/Stable)
Hysan Development Company Limited (‘BBB+'/Stable)
Nan Fung International Holdings Limited (‘BBB’/Stable)
Road King Infrastructure Limited (‘BB-'/Stable)
Shanghai Zendai Property Limited (‘B’/Stable)
Shimao Property Holdings Limited (‘BB’/Stable)
Sun Hung Kai Properties Limited (‘A’/Stable)