|Issuer||Country Garden Holdings Co Ltd|
|Guarantor||Subsidiaries With Restrictions|
|Issue/ Reoffer Price||100.000|
|Years to Maturity||3.965|
|Annual Coupon Frequency||Semi Annually|
|Annual Coupon Rate (% p.a.)||7.500|
Bond Credit Rating (Moody's / S&P / Fitch) Ba1/ BB/ BB+
Issuer Credit Rating (Moody's / S&P / Fitch) Ba1/ BB/ BB+
Seniority Senior Secured
Exchange Listed SGX
Modified Duration 3.4
Issue Size USD 900,000,000
|Bond Credit Rating (Moody's / S&P / Fitch)||Ba1/ BB/ BB+|
|Issuer Credit Rating (Moody's / S&P / Fitch)||Ba1/ BB/ BB+|
|Issue Size||USD 900,000,000|
Announcement: Moody's: Country Garden's rating headroom reduced by weak 2015 results回覆刪除
Global Credit Research - 16 Mar 2016
Hong Kong, March 16, 2016 -- Moody's Investors Service says that Country Garden Holdings Company Limited's weakened credit metrics for 2015 has reduced its rating headroom, but the higher-than-expected leverage will not immediately affect the company's Ba1 corporate family or senior unsecured debt ratings.
The outlook for the firm is stable.
"The rating headroom on Country Garden's Ba1 ratings has been reduced by its higher-than-expected debt leverage in 2015," says Franco Leung, a Moody's Vice President and Senior Analyst.
Country Garden's debt leverage — as measured by revenue to adjusted debt and including perpetual capital securities — deteriorated to around 102% in 2015 versus 126% in 2014 because the company increased its land acquisitions to RMB55.95 billion from RMB16.17 billion in the same periods.
The company increased its debt funding and its adjusted debt increased to around RMB111.5 billion at end-2015 from RMB66.9 billion at end-2014.
Country Garden will likely remain active in land acquisitions in 2016, but Moody's expects that the company will maintain a modest contracted sales growth and healthy operating cash flow, which will in turn reduce its debt growth over the next 12-18 months.
In addition, Moody's expects that the company will continue to achieve growth in revenue, such that its revenue to debt will be brought back to a level ranging from 110%-120% in 2016; a result which would support its Ba1 ratings.
"Country Garden's weak credit metrics in 2015 was also driven by its lower profit margin," adds Leung, who is also the Lead Analyst for Country Garden.
Country Garden's gross profit margin fell to 20.2% in 2015 compared to 26.1% in 2014, mainly due to the recognition of low-margin properties sold in 2014, when China's property market was weak. As a result, the company's EBIT/interest coverage ratio fell moderately to 3.7x in 2015 from 3.9x in 2014.
Moody's expects that Country Garden's gross margin will improve moderately to 21%-24% in 2016, because it will recognize higher-margin properties sold in 2015.
Country Garden's declining gross margins have prompted the company to reduce its borrowing costs. Its weighted average interest rate fell to 6.20% in 2015 from 7.59% in 2014. Moody's expects Country Garden to further manage down its average funding cost to improve its EBIT interest coverage to 3.8x-4.0x in 2016.
Despite Country Garden's significant exposure to third and fourth tier cities, the company achieved a 7.1% year-on-year growth in contracted sales to RMB140.2 billion in 2015; a result which reflects its strong sales execution.
The company continued to demonstrate strong sales momentum into 2016, achieving around RMB23.7 billion in contracted sales in the two months between January and February 2016. The amount represents 14% of its sales target for the year.
Country Garden's liquidity position is strong. Its cash holdings — including restricted cash — increased significantly to RMB47.9 billion at end-2015 from RMB27.2 billion at end June-2015. As a result, its cash to short-term debt strengthened to about 210% from about 141% over the same period.
The principal methodology used in these ratings was Homebuilding And Property Development Industry published in April 2015. Please see the Ratings Methodologies page on www.moodys.com for a copy of this methodology.
Country Garden Holdings Company Limited, founded in 1997 and listed on the Hong Kong Stock Exchange, is a leading Chinese integrated property developer. At end-2015, its land bank totaled a sizeable 109.8 million square meters in attributable gross floor area.
At end-2015, it owned and operated 59 hotels with a total of 13,819 rooms. The hotels were located mainly in Guangdong Province, and support its development of townships.
Bought @ 104.65回覆刪除
Yield to Maturity (YTM) (%) 6.18
Duration(A+B)(in yrs.) 3.3620293709127993
callable on 3/9/2018 or after @100
最近看到碧桂園另一直債4.75%coupon, Sep-2023到期 callable Sep-2020.回覆刪除
不知道天兄有否留意，YTM 5.29%, 只是年期接近7年，好似長了點，想請教一下天兄的意見。
忍藏兄：今時今日BB+債券有5.3%也不錯了，雖然年期是七年。比較之下， 2020年債價錢相對更貴，只有4.3% YTC。你也提醒了我，應該考慮換馬到2023年債券。很多時買賣債券，都是因為換馬。既然有更好的選擇為何不換呢。雖然還有七年才到期，期閒也可以賣出換過另一隻更好的。是嗎？回覆刪除