stock 101 HANG LUNG PPT

Chinese developers can meet targets despite slowdown - S&P


[ET Net News Agency, 10 May 2013] Chinese developers are on track to meet their sales
targets for 2013 after a strong first quarter. But sales growth may slow down over the
course of the year as the central government's latest market-cooling measures kick in,
according to an industry report card that Standard & Poor's Ratings Services released
today.
"The developers' sales targets may appear aggressive, but the strong sales so far in
what is usually a slow selling season, suggests it could be mission possible," said S&P's
credit analyst Bei Fu.
"While we expect some of the sales momentum to lose steam, overall performances should
be good for full-year 2013." she added.
The report notes, however, that the governments of top-tier cities are likely to more
strictly implement new regulations, and that could have a dampening effect on transaction
volume.
"In our base case, we continue to assume up to 10% growth this year in transaction
volume for bigger players and limited growth for smaller players. We expect 5% growth in
average selling prices on average," said Fu. "Given the mix of opportunity and challenges,
we maintain our stable outlook on the sector. Ratings are likely to remain largely
stable."
The report also addresses the improving funding channels for developers, their stronger
discipline toward growth, and the likelihood of further industry consolidation. (KL
)