Vanke Shares Dive After Third-Quarter Profit Drop
By Yifan Wang
Shares of China Vanke Co., one of China's largest property developers, slumped on Monday, as the company's latest earnings weakness further weighed on already-fragile investor sentiment.
Vanke's Hong Kong-traded stock dropped by as much as 9.2% in morning trade and were last down 7.1% at 10.51 Hong Kong dollars (US$1.34), while its Shenzhen shares tumbled 5.3% to 13.58 Chinese yuan (US$1.87).
The steep losses came after Vanke on Friday posted a 14% drop in its third-quarter net profit, after 10% earnings growth in the first half of the year. The developer's margins and net gearing also deteriorated.
Vanke's fall added to a broader selloff in Chinese real estate stocks on Monday, as a change of leadership at another major developer stoked investors' concerns about worse-than-expected liquidity problems in the industry. The Hang Seng Mainland Properties Index was down 6.1%. Longfor Group Holdings Ltd. led the slump with a 24% decline, after its founder, Wu Yajun, stepped down as chairperson.
"The resignation is an apparent vote of no confidence in the industry," said Stephen Innes, Managing Partner at SPI Asset Management.
Write to Yifan Wang at firstname.lastname@example.org
(END) Dow Jones Newswires
October 31, 2022 00:14 ET (04:14 GMT)Copyright (c) 2022 Dow Jones & Company, Inc.