China’s real estate giant Evergrande files for bankruptcy
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The real estate crisis in China started in mid-2021 and since then many big companies have defaulted. These companies account for 40 per cent of the total house sales in the country. It is believed that the crisis in China’s real estate sector can engulf other sectors as well. The condition of country’s biggest private developer Country Garden is also getting worse day by day. The company has defaulted in payment of interest this month. This has made investors very nervous. Many housing projects in China are stuck due to the real estate crisis.
When was the company formed
Evergrande has said that creditors can vote on restructuring this month. Last month, the company said that in 2021 and 2022 it suffered a total loss of $ 81 billion. This has created panic among investors. The company had given a debt restructuring plan in March, but questions are also being raised about it. On Monday, its electric vehicle unit China Evergrande New Energy Vehicle Group also proposed restructuring. Trading of China Evergrande’s shares has been suspended since March 2022.
Evergrande, established in 1996, is one of the largest real estate companies in China. Its founder Xu Jiayin was the richest businessman in the country in the year 2017. After the success in real estate, the company entered into electric vehicles, health clinics, mineral water and many other businesses. Since 2021, the Hong Kong stock market has registered a steep decline in the company’s shares.
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