China’s big housebuilders tipped for growth

The twin forces of urbanisation and industry consolidation have made China’s large property developers increasingly attractive to bond investors. Data shared by asset manager Pimco indicates that the top ten property developers in China raised their market share from about 5% to nearly 25% between 2006 and 2017. “We believe the key investment opportunities for bond investors lie with larger developers that can benefit from sector consolidation, while at the same time demonstrating an improving credit profile,” said Frank Chen, credit research analyst at Pimco. Real estate is taking up a larger share of the Chinese economy as citizens flock to the cities and house prices rise. Pimco estimates China’s property market to be worth $22 trillion, which is 1.8 times the nation’s GDP in 2017. “Despite long-running international concerns about China’s property ‘bubble’, the market has proven quite resilient,” said Chen. ©2018 funds global asia

Executive Interviews

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Changes to regulation, US-Sino trade tensions and further steps by China to open its capital markets were some of the topics discussed by our panel. Chaired by Romil Patel in Hong Kong.