On September 19, a report on the solvency of real estate companies in the first half of 2021 released by the Crane Research Center showed that 80 key listed real estate companies monitored by Crane had five cash holdings in the first half of 2021. For the first time this year, the growth rate of total interest-bearing liabilities has also continued to decline, and the scale is basically the same as that of the beginning of 2021.
According to the report, at the end of the first half of 2021, the cash holdings of 80 key listed real estate companies were 317.7 billion yuan, a slight decrease of 0.2% from the beginning of 2021. This is the first decline in five years. With the steady progress of the policy of “housing to live without speculation” in recent years, the industry has entered a period of slow growth, and the growth rate of cash held by real estate companies has shown a downward trend, from the growth rate of more than 20% in 2017 and 2018. Decline to a growth rate of more than 10% in 2019 and 2020. Since the introduction of the three red lines in the second half of 2020, real estate companies have continued to reduce leverage and increased financing cash outflows; the “two red lines” superimposed on the housing loan concentration management system have been introduced, and the sales collection cycle of real estate companies has lengthened, part of the first half of the year The sales collection rate of real estate companies has dropped to a certain extent, which has led to a decrease in the overall cash holdings of real estate companies at the end of the first half of 2021.
Judging from the performance of each echelon, the TOP10 real estate companies still have an advantage in cash holdings, with cash holdings of 1,266.2 billion yuan, a decrease of 1.48% from the beginning of the period. The cash holdings of the TOP11-30 echelon and the TOP51+ echelon real estate companies have increased compared with the beginning of the period. Among them, the growth of the TOP11-30 real estate companies is relatively high, with a growth rate of 2.88%.
However, it should be noted that only 50% of the real estate companies in the first half of this year have increased their cash holdings compared to the beginning of the period, and in 2020 this figure is 81%, accounting for 2020 A decrease of 31 percentage points in the year. Among the companies with cash growth, only 6% of the companies have an increase of more than 50%, and at the end of 2020, 25% of the companies have a cash increase of more than 50%. Crane believes that under the general environment of reduced leverage, coupled with the impact of sales collection, the decline in corporate cash growth is inevitable.
In terms of interest-bearing liabilities, Crane’s statistics show that as of the end of June, the total interest-bearing liabilities of 80 key real estate companies was 7,118.5 billion yuan. The debt scale remained above 7 trillion yuan, an increase of 0.4% from the beginning of the period, and the growth rate continued to decline from 5.4% in 2020.
Cerui believes that after the growth rate of interest-bearing debt of real estate companies reached a high point in 2017, in recent years, as industry regulation continues, consolidated debt has increased. The growth rate of interest-bearing debts of various companies has continued to decline, especially since the three red lines.Real estate companies have relatively strict control over their own debt increments, and most real estate companies maintain a state of “paying within their means”.
From the perspective of the term structure of interest-bearing bonds, 80 real estate companies’ short-term interest-bearing bonds at the end of the first half of 2021 were 201.4 billion yuan, a decrease of 9.3% from the beginning of the period. After the first year-on-year decline at the end of 2020, the decline has been maintained, and the decline has expanded by 6.5 basis points from 2.8% in 2020; at the same time, long-term interest-bearing bonds at the end of the first half of 2021 will be 5,117 billion yuan, an increase of 4.8% from the beginning of the period. The growth rate is 1.5 basis points higher than that at the end of 2020. The net debt ratio of real estate companies decreased by 4.53 percentage points year-on-year to 66.54%, and about 60% of the real estate companies’ net debt ratio achieved a decline. Through adjustment and optimization, there were 33 real estate companies in the green sector at the end of the first half of 2021, an increase of 3 from the end of 2020, 11 orange sectors, an increase of 3, and red sectors reduced by half to 4.
Since the government promulgated the three red line regulatory indicators at the end of August 2020, the three red lines have become an important measure for real estate companies to improve their financial conditions. To improve the three red line indicators as a focus of financial work.
According to the statistics of Kerui, from the financial situation of 80 key real estate companies in mid-2021, the arithmetic average of their cash short-term debt ratio is 1.7. The median is 1.55; the arithmetic mean of the net debt ratio is 80.42%, and the median is 72.54%. Both the cash short-term debt ratio and the net debt ratio can basically meet the standards. Only after excluding advance receipts, the debt-to-asset ratio exceeds 70% in both arithmetic average and median. The report emphasizes that although there has been improvement compared to the beginning of the period, most companies are still stepping on this indicator, and the future will be the focus of real estate companies’ improvement.
In addition, in the first half of this year, due to the influence of the financing environment and the constraints of the three red lines, many developers have increased their debt repayment efforts. After real estate companies’ short-term interest-bearing liabilities fell for the first time at the end of 2020, they continued to decline in the first half of this year, making the industry’s average short-term debt ratio between 0.15 and 1.6 and strengthening the short-term safety margin. At the end of the first half of 2021, the weighted average of the cash short-term debt ratio of 80 real estate companies increased by 0.14 to 1.6 compared to the beginning of the period, reaching the highest value in the past four years. Real estate companies’ liquidity and margin of safety have improved. The weighted average of the long-term and short-term debt ratios increased by 0.34 to 2.56 from the beginning of the period, and the median increased by 0.34 to 2.49 from the beginning of the period, which was also the highest value in the past four years. The effectiveness of debt structure optimization continued to show, and the short-term debt repayment risk was reduced. To