Elevator Pitch
I upgrade my rating on Hong Kong-listed Mainland China property developer Greentown China Holdings, Ltd. (GTWCF) [3900:HK] from "Bearish" to "Neutral."
Greentown China recognized provisions for impairment losses amounting to -RMB1,376 million in FY2019, which came as a negative surprise and makes investors question the quality and valuation of Greentown China's assets. Greentown's high adjusted net gearing and refinancing risks are also concerns. The company's adjusted net gearing (treating perpetual securities as debt rather than equity) was approximately 135% as of the end of FY2019, and 36.6% of the company's total debt being