By Yifan Wang
Shares of CIFI Holdings (Group) Co /zigman2/quotes/200786198/delayed HK:884 -2.68% . fell sharply on Wednesday, following reports that an entity related to the Chinese developer had missed a debt payment.
The stock fell as much as 29% and was last down 27% at HK$0.93. That would put CIFI on track for its worst-ever one-day drop.
The selloff came after a widely-circulated media report claimed that a company controlled by CIFI has missed payment on a debt product. Credit markets data provider Debtwire later reported that CIFI is in talks to extend its deadline on repayment for a trust product due Tuesday, citing unnamed sources.
CIFI didn’t immediately respond to a request for comment.
CIFI was one of several developers approved by Beijing to sell new bonds since the liquidity crisis in China’s real estate industry worsened in 2021, and has a reputation for being relatively resilient within the sector. Any defaults by CIFI would thus be a significant hit to the already-fragile sentiment in China’s real estate market, analysts say.
“This is very important, because CIFI hadn’t missed payment before,” said a Hong Kong-based property equities analyst. “The first miss is always crucial.”
If reports of a missed payment prove true, it would be a sign that even the better-quality private developers are beginning to face problems, he said.
Write to Yifan Wang at firstname.lastname@example.org