Xu Jiayin’s “jumping show”, which was screened two days ago, was finally denied by the report that Xu Jiayin personally attended an internal company meeting. However, for the rumors of Xu Jiayin jumping off the building under the debt, what is most exciting is not only the crowd watching the fun and not being afraid of big things, but also the financial media who have obviously lacked hot spots for a long time, and it is also a group pressure on Evergrande’s creditors. test.
Evergrande previously used excessive financial leverage to promote the rapid growth of the enterprise scale, and at the same time used a large amount of cash flow for random investment and long-term investment, engaged in football and public welfare in exchange for false names, which also exacerbated the tightness of the enterprise’s capital chain . In addition, the failure of the backdoor Shenzhen Real Estate Return A strategy locked in a group of investors such as Suning Zhang Jindong, and encountered the property market downturn and huge investment in new energy vehicles but no sales revenue in the short term. Therefore, the capital chain was broken and the open market defaulted. This in turn makes it more difficult for companies under the downturn of the property market to sell off, prompting the outbreak of poor financing, rapid deterioration of cash flow, and substantial asset impairment. The further deterioration of liquidity and damage to corporate reputation, in turn, has affected sales and financing. Under the pressure of liquidity, book assets have also fallen into a sharp impairment channel, which has caused Evergrande to fall into a rapidly falling debt spiral. among.
Judging from the current industry situation and the situation Evergrande is facing, Evergrande’s asset and liability situation after falling into a debt spiral has deteriorated to the point that it is difficult to recover. Originally, Evergrande’s book assets were much greater than its liabilities at the beginning, and the revaluation value may be even greater. However, after falling into the debt spiral, the assets suffered a sharp depreciation and even were directly lost due to various reasons, while the debts would rise sharply instead. As a result, the value of assets will inevitably be reduced to the point that it may not even be able to cover a fraction of the debt. In this regard, you can refer to the price changes of bulk commodities, just like the price of oil once fell into negative territory, which led to the situation of “I give you money, please take the oil away!”.
At the same time, Evergrande, which was trapped in a debt spiral and tried its best to save itself, panicked and made no choice, which led to a major violation of laws and regulations involving the misappropriation of 13.4 billion yuan of Evergrande property customer deposits. It is even more unavoidable that a large number of asset impairments, passive reductions, passive sales, and a large number of overdue undeveloped land are taken back by local governments without compensation. The hope of relying on debt restructuring to reverse the passive situation of enterprises and resume operations is already too high. slim. Xu Jiayin’s previous declaration that he would never sell his assets at a low price naturally became empty talk. Because at this time, whether or not to sell assets at a low price is no longer up to the actual controller of the enterprise, but the pledgee and the local government that holds the land transfer contract have the final say.
In the past few days, a lot of news that is not conducive to Evergrande has continued to surface. The 39 capped residential buildings in the second phase of Haihua Island in Danzhou, Hainan were fined and confiscated for violating the planning. The Evergrande headquarters plot in Qianhai, Shenzhen and the plot in Yuen Long, Hong Kong changed hands successively. Eleven overdue undeveloped lands in Jiangxia District of Wuhan were also taken back by the government without compensation. As for the personal assets of Xu Jiayin, the actual controller of Evergrande, such as the luxury house in Hong Kong, the relevant institutions are constantly exercising the pledge right and the transfer of property rights. It can be said that Evergrande is indeed in a precarious situation.
As far as things that can continue to be done at present, the core essence of Evergrande is to go all out to guarantee the delivery of the building. In addition to the company’s major shareholders and actual controllers having to bear joint and several liabilities for the delivery of the guarantee, the institutional creditors and relatively Big individual creditors are bound to pay the price, too. Because in the face of the politically correct task of guaranteeing the delivery of the building, the interests of creditors must be shifted backwards, and shareholders and actual controllers are ranked last. As for the final outcome of Evergrande and Xu Jiayin that the public is concerned about, you might as well refer to HNA Group and Chen Feng. If Xu Jiayin can go all out to ensure the delivery of the building and cooperate with the debt resolution, Evergrande may be restructured or liquidated at a very low value, and Xu Jiayin can also achieve personal security after losing his wealth. Otherwise, the individual’s personal freedom may not be guaranteed.
Although the times make heroes, and those who can become heroes also have personality endowments that are different from ordinary people, how to make decisions and respond when the situation reverses is more a test of people, and it also reflects a person’s insight, decision-making ability, and peace of mind. Taoism accumulation. At the critical moment of the crisis, repaying debts with assets or selling assets to repay debts in exchange for the opportunity to take the initiative and even survive is actually the time when the opportunity to reassess the value of assets appears. Human decision-making is very important. Wang Jianlin, who was forced to slash prices on the spot to sell the hotel, has now once again let Wanda go public, and has become a company that entered the top 50 real estate companies against the current downward trend, and bought the hotel at a great bargain R&F Real Estate and the “Professor Xu” who used to be proud of the rivers and lakes now only know how well they are.
Take a step back, and often it is the sea and the sky. However, it must be an empty talk and a lie to have a thick life without experiencing enough things. (Fortune Chinese website)
The author, Bo Wenxi, is a columnist of Fortune Chinese Network and chief economist of IPG China
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