Hong Kong Chinese Property Group released its financial report for the first half of 2024 on August 14, showing a loss of 422 million Hong Kong dollars attributed to the owners during this period, marking the first time a loss has been reported in the interim and annual reports of Chinese property ownership in nearly three years.
In the mid-year performance announcement for 2024 issued by Hong Kong Stock Exchange on the 14th, Chinese Property Group reported a revenue of 195 million Hong Kong dollars for the first half of the year, a decrease of 27.9% compared to the same period last year. The loss attributed to the owners during this period was 422 million Hong Kong dollars.
According to the announcement, the loss was mainly due to a decrease in investment income from the sale of investment properties and a shift from profit to loss in the fair value of investment properties during this period.
However, on August 15, Fenghuang Net Real Estate stated that the losses of Chinese Property Group were related to its investment in Evergrande.
Reports indicated that over the past decade, founder of Chinese Property Group, Liu Luoxiong, has invested nearly 30 billion Hong Kong dollars in mainland China through Chinese Property Group and other investments to support the commercial expansion of Xu Jiayin and Evergrande, as well as purchasing bonds of mainland Chinese real estate companies. However, with the deep adjustment of the mainland real estate market, the arrest of Xu Jiayin, the collapse of the Evergrande Group, and defaults on several mainland stocks and bonds, his investments are facing challenges.
Especially since the collapse of Evergrande in 2021, with significant losses in investment income, the performance of Chinese Property Group has fluctuated significantly in recent years, once recording a massive net loss of over 3.5 billion Hong Kong dollars.
Fenghuang Net Real Estate revealed that starting from 2008, based on incomplete statistics, Chinese Property Group and the Liu Luoxiong family have invested approximately 28 billion Hong Kong dollars in the purchase of shares of Evergrande-related companies such as China Evergrande, Shengjing Bank, Evergrande Property, and Evergrande Automobile.
However, after signs of the Evergrande Group’s collapse first emerged in August 2021, the Liu Luoxiong family began rapidly selling Evergrande shares to cut losses. In addition to holding shares in Evergrande-related companies, Chinese Property Group also held 27 bonds of companies such as China Liang Holdings, Evergrande Group, and Jiayouye Group. As of the end of 2023, Chinese Property Group’s remaining securities investments and financial assets portfolio amounted to 342 million Hong Kong dollars, accounting for a reduced 1.8% of the total assets.
Two years ago, during the Chinese Property Group’s shareholders’ meeting, a shareholder confronted Liu Luoxiong face-to-face, stating that “investing in Evergrande was a wrong decision.”