Evergrande Group

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Evergrande Group
恒大集团
TypePublic
SEHK3333
IndustryReal estate
Founded1996; 25 years ago (1996)
FounderXu Jiayin (Hui Ka Yan)
Headquarters,
China
Area served
China
Key people
Xu Jiayin (Chairman)
RevenueIncrease CN¥507.250 billion[1]
(US$77.713 billion, 2020)
Decrease CN¥63.520 billion[1]
(US$9.732 billion, 2020)
Decrease CN¥8.076 billion[1]
(US$1.238 billion, 2020)
Total assetsIncrease CN¥2,301 trillion[1]
(US$306.410 billion, 2020)
Total equityDecrease CN¥350.431 billion[1]
(US$53.687 billion, 2020)
Number of employees
123,276[2] (31 December 2020)
SubsidiariesHengda Real Estate
Websitewww.evergrande.com
Evergrande Group
Simplified Chinese恒大集团
Traditional Chinese恆大集團

The Evergrande Group (恒大集团) or the Evergrande Real Estate Group is the second largest property developer in China by sales.[3] It is ranked 122nd on the Fortune Global 500.[4] It is incorporated in the Cayman Islands and headquartered in the Houhai Financial Center in Nanshan District, Shenzhen, Guangdong Province, China.[5] It was founded in 1996 by Xu Jiayin. It sells apartments mostly to upper and middle-income dwellers.[6] In 2018, it became the most valuable real estate company in the world.[7]

In 2021, payments due on its debt, estimated in the hundreds of billions of dollars, resulted in the Evergrande liquidity crisis. This was one of the reasons for a drop in many stock market indices on September 20, 2021.[8]

History[edit]

Formerly called the Hengda Group, Evergrande was founded by Xu Jiayin in the southern Chinese city of Guangzhou in 1996, during a period of mass urbanization in China.[9]

In October 2009, the company raised $722 million in an initial public offering on the Stock Exchange of Hong Kong (SEHK).[10]

Operations and business interests[edit]

Real estate[edit]

Evergrande Group owns 565 million square metres of development land and real estate projects in 22 cities, including Guangzhou, Tianjin, Shenyang, Wuhan, Kunming, Chengdu, Chongqing, Nanjing, Zhengzhou, Luoyang, Changsha, Nanning, Xian, Taiyuan and Guiyang in Mainland China.[11] Notable projects by the company include Ocean Flower Island in Hainan.

Evergrande Real Estate is the second-largest property developer in China. It is known as "Wan Heng Bi" with the other two top three real estate companies: Vanke and Country Garden. The firm has developed projects in over 170 cities in China. It is the second-largest real estate developer in Mainland China.

Evergrande Plaza, in Chengdu, was designed by Aedas, and completed in 2014.[12]

Tourism and recreation[edit]

Evergrande owns two major theme park brands "Hengda children of the world", "Hengda water world", and Hainan has a large tourist complex "Chinese island of Hainan to spend".[13][14][15]

The under-construction Ocean Flower Island in Hainan is one of its major projects.

Sports[edit]

In 2010, it acquired football club Guangzhou Evergrande F.C. and invested heavily to acquire top players. In 2013, under Marcello Lippi, the group won the 2013 AFC Champions League. Alibaba also has a 50% stake in the football club.[16]

On April 16, 2020 Evergrande opened the construction of Guangzhou Evergrande Football Stadium in Xie Village, Panyu District, Guangzhou.[17]

Evergrande Football School is a football tutoring school.

The company is a sponsor of the Women's Guangdong Evergrande Volleyball Club.

Automotive[edit]

In 2018, Evergrande acquired a 45% stake in electric vehicle company Faraday Future for $2 billion through its Evergrande Health subsidiary.[18]

In November 2019, Evergrande announced that it would invest ¥45 billion over the following three years to develop new energy vehicles, build three production bases in Nansha, Guangzhou and Shanghai, and launch electric vehicles branded as "Evergrande New Energy Vehicle" in 2020.[19][20]

In 2020, the company launched the Hengchi electric vehicle brand.[21]

In July 2019, the company partnered with State Grid Corporation of China to develop electric vehicle charging stations.[22]

In June 2020, Evergrande Group acquired the remaining 49% of NEVS for $380 million, after having acquired 51% of the shares for $931 million in 2019.[23]

Health[edit]

In March 2015, Evergrande acquired New Media Group Holdings and renamed it Evergrande Health.[24]

Evergrande Health Group operates "Evergrande Health Valley", a health and wellness park, and retirement community.[25]

It also works with Brigham and Women's Hospital in Massachusetts to manage Boao Evergrande International Hospital in Hainan.[26]

Entertainment[edit]

The Hengda Music Festival Tour Concert operated in over 30 cities in 2014 and included performances by Cui Jian.[27]

HengTen Networks was formed in 2015 in partnership with Tencent.

In October 2020, HengTen Networks announced that it would acquire Ruyi Pictures for HK$7.2 billion.[28]

In August 2021, the company sold a 7% stake in HengTen to Tencent for US$418 million.[29]

Finance[edit]

In November 2015, Evergrande acquired a 50% stake in Sino-Singapore Great Eastern Life Insurance Company for $617 million and changed its name to Evergrande Life.[30]

It also owns shares in Shengjing Bank.[31]

Evergrande has also sold wealth management products to consumers.[32]

Food and agriculture[edit]

In 2014, Evergrande Group launched its "Hengda Bingquan" (later "Evergrande Spring") mineral water brand and invested ¥5.54 billion in it, including hiring Jackie Chan to promote the brand.[33]

Evergrande's water brand received significant negative attention from Korean consumers, as the water source on the label was listed as "Jang bai shan" rather than the Korean name "Mount Baekdusan." The use of the Chinese name of the mountain — which borders China and North Korea — is a point of stress between China and South Korea.[34]

In September 2016, after a loss of ¥4 billion, Evergrande sold its agribusiness units, which included its mineral water brand, dairy business, and grain and oil business, for ¥2.7 billion.[35][36]

In 2016, Evergrande announced it was investing ¥300 million to build more than 110 pig farms in southwestern Guizhou province.[37]

Financial data[edit]

Financial data in CNY[38][39][40]
Year Revenue Net Income Assets Equity
2010[41] 45,801,401,000 8,024,676,000 104,452,464,000 21,366,225,000
2011[42] 61,918,185,000 11,726,593,000 179,023,408,000 34,130,753,000
2012[43] 65,260,838,000 9,181,921,000 238,990,551,000 41,691,325,000
2013[44] 93,671,780,000 12,611,778,000 159,950,689,000 79,342,634,000
2014[45] 111,398,112,000 12,604,053,000 206,225,229,000 112,378,004,000
2015[46] 133,130,000,000 10,460,000,000 757,035,000,000 142,142,000,000
2016[47] 211,444,000,000 5,091,000,000 1,350,868,000,000 192,532,000,000
2017[48] 311,022,000,000 24,372,000,000 1,761,752,000,000 242,208,000,000
2018[49] 466,196,000,000 37,390,000,000 1,880,028,000,000 308,626,000,000
2019[50] 477,561,000,000 17,280,000,000 2,206,577,000,000 358,537,000,000
2020[51] 507,248,000,000 8,076,000,000 2,301,159,000,000 350,431,000,000

Financial problems[edit]

In 2016, the Hong Kong Market Misconduct Tribunal suspended American short seller and Citron Research founder Andrew Left for five years, due to the publication of a highly critical report on the company, "finding him culpable of disclosing false or misleading information inducing transactions under the Securities and Futures Ordinance (SFO) in the publication of a research report on Evergrande Real Estate Group Limited (Evergrande) in June 2012."[52][53][54] The trading ban "has raised concerns over freedom of speech in Hong Kong’s financial markets."[55]

In summer of 2021, payments due on its debt, estimated in the hundreds of billions of dollars, resulted in the Evergrande liquidity crisis.[56][57][58][59][60] This was one of the reasons for a drop in many stock market indices on September 20, 2021.[61] On 21 October, 2021, Evergrande announced that a $2.6 billion asset sale to that would have been used to pay an $83 million interest payment it missed in September, 2021 had failed to close.[62]

See also[edit]

References[edit]

  1. ^ a b c d e "China Evergrande Group financials". finance.yahoo.com. Retrieved 31 May 2021.
  2. ^ "China Evergrande Group profile". finance.yahoo.com.
  3. ^ "Evergrande draws eight strategic investors for Shenzhen listing". South China Morning Post. 2 January 2017.
  4. ^ "China Evergrande Group Fortune Global 500". Fortune.
  5. ^ "Contact". Evergrande Group. 35 / f, excellent houhai financial center, no. 1126 Hyde [sic] road, nanshan district, shenzhen - Chinese address: "深圳市南山区海德三道1126号" (based on the Chinese address it is Haide Third Road)
  6. ^ Martin, Nik (16 September 2021). "Evergrande: Why the Chinese property giant is close to collapse". Deutsche Welle.
  7. ^ "China's Evergrande tops world's most valuable real estate brand". Xinhua News Agency. 5 September 2018.
  8. ^ "Struggling Evergrande Group says it will make bond payment this week". CBS News. 22 September 2021.
  9. ^ Stevenson, Alexandra; Li, Cao (August 10, 2021). "Evergrande Went From China's Biggest Developer to One of Its Worst Debtors". The New York Times.
  10. ^ Or, Amy (October 30, 2009). "Evergrande Gets $722 Million". The Wall Street Journal.
  11. ^ Lee, Georgina (June 2, 2021). "China Evergrande unit slides by record in US$1.9 billion sell-off as seller offloads stock after lock-up period expires". South China Morning Post.
  12. ^ Evergrande Plaza, a Hong Kong-style shopping mall, opens in Chengdu. [1] Retrieved 15 December 2015.
  13. ^ Jeremy Goldkorn (24 September 2020). "Is indebted real estate developer Evergrande Group seeking government support?". supchina.com. Retrieved 19 June 2021.
  14. ^ Qu Hui,Yang Ge (22 October 2020). "Environmental Violations Dog Struggling Evergrande's Hainan Mega-Resort". caixinglobal.com. Retrieved 19 June 2021.
  15. ^ "Evergrande Group's Ocean Flower Island". ravensuncreative.com.
  16. ^ "Alibaba, Evergrande-owned soccer club files for China IPO in Asian first". Reuters. 2015-07-02. Retrieved 2020-04-17.
  17. ^ Duerden, John (17 April 2020). "Chinese club Guangzhou Evergrande building world's biggest stadium for $1.7bn". ESPN.com. Retrieved 19 June 2021.
  18. ^ O'Kane, Sean (2018-06-26). "Faraday Future reveals the source of its $2 billion investment as a co-founder steps away". The Verge.
  19. ^ "Xinhua Silk Road: Evergrande teams up with global partners to promote NEV development" (Press release). PR Newswire. November 13, 2019.
  20. ^ "The road gets bumpy for billionaires investing in China's electric cars". The Japan Times. December 3, 2019.
  21. ^ "Evergrande to introduce first EV in 2020". Electrive. November 13, 2019.
  22. ^ Xuewan, Chen; Kirton, David (July 17, 2019). "State Grid, Evergrande Team Up to Build Electric-Car Charging Network". Caixin.
  23. ^ "Evergrande to buy up the rest of NEVS". Electrive. June 17, 2020.
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  25. ^ "Evergrande Health Valley in Nanning Airport Economic Zone".
  26. ^ "Boao Evergrande International Hospital". en.lecityhn.com.
  27. ^ "2014 Hengda Music Festival Tour Concert in Haikou Dec 14". Haikou.
  28. ^ "Online Home Furnishing Group Makes Surprise $1 Billion Bid for TV Production Company". Caixin. October 28, 2020.
  29. ^ Zaharia, Marius (August 1, 2021). "China's Evergrande to sell stakes in HengTen internet unit for $418 mln". Reuters.
  30. ^ Baldwin, Clare (November 22, 2015). "Chinese developer Evergrande strikes $617 million life insurance deal". Reuters.
  31. ^ "Evergrande Raises $154 Million Paring Stake in Key Bank Unit". Bloomberg News. August 17, 2021.
  32. ^ "Lured by promises of high returns, thousands gave Evergrande cash". Al Jazeera. Retrieved 23 September 2021.
  33. ^ "How Beijing's Debt Clampdown Shook the Foundation of a Real-Estate Colossus". The Wall Street Journal. September 18, 2021.
  34. ^ Herald, Korea (2014-07-02). "Kim Soo-hyun's controversial Chinese ad revealed". The Korea Herald. Retrieved 2021-09-22.
  35. ^ "Evergrande Sells Food, Beverage Units to Focus on Real Estate". Bloomberg News. 2016-09-28.
  36. ^ "DISPOSAL OF NON-CORE BUSINESSES IN GRAIN AND OIL, DIARY PRODUCTS AND SPRING WATER" (PDF).
  37. ^ YUANKE, ZHANG (December 9, 2020). "Evergrande, Vanke, Over 1,000 Chinese Developers Try Their Hand at Pig Farming". Shanghai Media Group.
  38. ^ "China Evergrande Group (3333.HK) Income Statement". finance.yahoo.com.
  39. ^ "China Evergrande Group (3333.HK) Balance Sheet". finance.yahoo.com.
  40. ^ "Revenue of Evergrande Real Estate Group Ltd. from 2010 to 2020". Statista.
  41. ^ "2010 Annual Report" (PDF). doc.irasia.com.
  42. ^ "2011 Annual Report" (PDF). doc.irasia.com.
  43. ^ "2012 Annual Report" (PDF). doc.irasia.com.
  44. ^ "2013 Annual Report" (PDF). doc.irasia.com.
  45. ^ "2014 Annual Report" (PDF). doc.irasia.com.
  46. ^ "2015 Annual Report" (PDF). doc.irasia.com.
  47. ^ "2016 Annual Report" (PDF). doc.irasia.com.
  48. ^ "2017 Annual Report" (PDF). doc.irasia.com.
  49. ^ "2018 Annual Report" (PDF). doc.irasia.com.
  50. ^ "2019 Annual Report" (PDF). doc.irasia.com.
  51. ^ "2020 Annual Report" (PDF). doc.irasia.com.
  52. ^ "Market Misconduct Tribunal bans Andrew Left of Citron Research from trading securities in Hong Kong" (Press release). Hong Kong: Securities and Futures Commission. 20 October 2016. Retrieved 31 July 2018.
  53. ^ "The report of the Market Misconduct Tribunal into dealings in the shares of Evergrande Real Estate Group Limited on 21 June 2012 (Part I)" (PDF). Market Misconduct Tribunal. 26 August 2016.
  54. ^ "The report of the Market Misconduct Tribunal into dealings in the shares of Evergrande Real Estate Group Limited on 21 June 2012 (Part II)" (PDF). Market Misconduct Tribunal. 10 November 2016.
  55. ^ Gough, Neil (2016-10-20). "Hong Kong Tribunal Suspends Investor Who Criticized Chinese Firm". The New York Times. ISSN 0362-4331. Retrieved 2016-10-21.
  56. ^ "Evergrande on course to hit record number of legal cases". Financial Times. 17 August 2021.
  57. ^ Yu, Sun; Mitchell, Tom; McMorrow, Ryan (14 September 2021). "China's Evergrande faces investor protests as liquidity crunch worsens". The Irish Times.
  58. ^ "Heavily indebted Chinese developer Evergrande warns of default risk". Financial Times. 31 August 2021.
  59. ^ Farrer, Martin (20 September 2021). "Shares in China's Evergrande plunge again as fears of contagion grow". The Guardian.
  60. ^ "Evergrande Market Fallout Grows as Local Unit Halts Bond Trading". Bloomberg News. 2021-09-16.
  61. ^ Doorn, Philip van. "Here are the worst-performing U.S. stocks as the Evergrande crisis rattles investors". MarketWatch. Retrieved 2021-09-22.
  62. ^ "Evergrande Shares Drop after $2.6b Deal Fails - October 21, 2021". Daily News Brief. 2021-10-21. Retrieved 2021-10-21.

External links[edit]