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Monday, April 12, 2010

Evergrande shares rise 8.5% on higher sales

Evergrande Real Estate Group Ltd, China’s second-biggest developer by sales, rose 8.5 per cent in Hong Kong yesterday after reporting that first-quarter sales more than doubled.

The stock closed at HK$3.59, its highest price since Feb 3.

Investors bought the stock, which had lagged behind its rivals, after the surge in sales, said Kenny Tang, an analyst at Redford Asset Management Ltd here.

‘People had been buying shares of the more established developers in China in the past few months amid uncertainty over how the government would cool the property market,’ said Mr Tang.

‘Now that the first-quarter sales look good for most developers, investors are turning to laggards such as Evergrande.’

The stock rose 0.9 per cent in March, following a 5.3 per cent decline in February and 21 per cent drop in January.

China Overseas Land & Investment Ltd, a Hong Kong-based builder controlled by the Chinese construction ministry, advanced 11 per cent in March and 13 per cent in February following a 15 per cent decline in January.

Evergrande, based in the southern Chinese city of Guangzhou, said on April 2 that first-quarter sales jumped 175 per cent to 8.53 billion yuan (S$1.744 billion), making it China’s No 2 developer on that basis. The Hong Kong stock exchange was closed for trading April 2 through April 6.

By area, Evergrande ranked No 1, having sold 1.3 million square metres in the first quarter, it said on its website, citing data from China Real Estate Information Corp.

Source : Business Times – 8 Apr 2010

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