Latest news with #NDVLY
Yahoo
4 days ago
- Business
- Yahoo
$28 Billion Shock: Hong Kong Giant Defers Debt Payments, Investors Blindsided
New World Development (NDVLY) has just reignited investor anxiety in Asias battered property sector. On the eve of Hong Kongs Dragon Boat Festival, the company quietly dropped news its pushing back coupon payments on four of its perpetual bondstotaling roughly $77.2 million. While this doesnt count as a technical default, the timing and lack of prior signals caught creditors off guard. Shares tumbled as much as 11% before closing down 6.5%, and its 4.8% perpetuals slid to just over 60 cents on the dollar before clawing back slightly. Several fixed-income desks scrambled late Friday, fielding urgent calls from senior PMs seeking clarity on what just happenedand why they werent warned sooner. Warning! GuruFocus has detected 8 Warning Signs with NDVLY. The developer, grappling with HK$220 billion ($28 billion) in liabilities, said the deferment is part of a broader effort to manage debt amid market volatility. But skepticism is rising. Morningstars Jeff Zhang noted the move, though not a default, adds to the future repayment burden. Nomura analysts called the action a credit negative, and floated the possibility of selective bond repurchases to ease pressure. Bondholder discussions with PJT Partners reportedly continue behind the scenes, though no formal action has been proposed. Its a stark reminder of the fragility still lingering in Hong Kongs real estate landscape, where rising vacancies and softening rents are squeezing even the most storied names. There is, however, a thread of optimism. As of late May, New World had reportedly secured commitments for around 60% of the HK$87.5 billion in refinancing its targeting by end-June. Management expects more progress after the public holiday. On the sales front, year-to-date property sales have already hit 95% of its full-year goal, according to its latest business update. Still, with a share price trading at just 0.07 times book and a market cap of $1.4 billiondown from $17 billion in 2019investors will likely need more than sales milestones to regain confidence. The next few weeks could determine whether this is a short-term scare or the start of something deeper. This article first appeared on GuruFocus.
Yahoo
6 days ago
- Business
- Yahoo
Hong Kong Property Giant Wobbles: New World Delays Bond Payments, Triggers Market Shock
New World Development (NDVLY) just delivered another shock to already-nervous investors. On Friday, the Hong Kong property giant announced it will defer coupon payments on four perpetual bondspushing back roughly $77.2 million in payments originally due next month. The decision sent its 6.15% perpetual bondscheduled for a June 16 coupontumbling over 12 cents to just 49.9 cents on the dollar. While this kind of deferral doesn't trigger a technical default, it's a flashing signal: the firm is feeling the squeeze. Warning! GuruFocus has detected 8 Warning Signs with NDVLY. In a brief statement, the company said it's managing debt while navigating a volatile market. But the backdrop tells a more pressing story. Home prices in Hong Kong have dropped 28% from their 2021 peak and remain stuck at 2016 levels. Residential property makes up half of New World's revenue. After reporting its first annual loss in 20 years, the company now faces one of the heaviest debt loads among Hong Kong developersHK$210.9 billion, to be exact. And with another perpetual bond due for a steep interest rate reset next month, the pressure could intensify. New World is scrambling to secure a HK$87.5 billion refinancing package before the end of June but has only locked in about 40% of that so far. It's also pitching a new HK$15.6 billion loan backed by its crown jewel, Victoria Dockside. If those deals fall through, the fallout could ripple far beyond the companyespecially for lenders already weighed down by rising defaults in commercial real estate. Investors are watching closely. What happens next could reshape Hong Kong's real estate risk landscape. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
6 days ago
- Business
- Yahoo
Hong Kong Property Giant Wobbles: New World Delays Bond Payments, Triggers Market Shock
New World Development (NDVLY) just delivered another shock to already-nervous investors. On Friday, the Hong Kong property giant announced it will defer coupon payments on four perpetual bondspushing back roughly $77.2 million in payments originally due next month. The decision sent its 6.15% perpetual bondscheduled for a June 16 coupontumbling over 12 cents to just 49.9 cents on the dollar. While this kind of deferral doesn't trigger a technical default, it's a flashing signal: the firm is feeling the squeeze. Warning! GuruFocus has detected 8 Warning Signs with NDVLY. In a brief statement, the company said it's managing debt while navigating a volatile market. But the backdrop tells a more pressing story. Home prices in Hong Kong have dropped 28% from their 2021 peak and remain stuck at 2016 levels. Residential property makes up half of New World's revenue. After reporting its first annual loss in 20 years, the company now faces one of the heaviest debt loads among Hong Kong developersHK$210.9 billion, to be exact. And with another perpetual bond due for a steep interest rate reset next month, the pressure could intensify. New World is scrambling to secure a HK$87.5 billion refinancing package before the end of June but has only locked in about 40% of that so far. It's also pitching a new HK$15.6 billion loan backed by its crown jewel, Victoria Dockside. If those deals fall through, the fallout could ripple far beyond the companyespecially for lenders already weighed down by rising defaults in commercial real estate. Investors are watching closely. What happens next could reshape Hong Kong's real estate risk landscape. This article first appeared on GuruFocus.
Yahoo
20-05-2025
- Business
- Yahoo
New World Faces $11.2B Debt Crunch as Clock Ticks on Refinancing Deal
New World Development (NDVLY) is staring down a HK$87.5 billion wall of debtand the clock's ticking. The company has until the end of June to lock in one of the largest refinancing deals in Hong Kong's corporate history. Why the urgency? A key covenant waiver on existing loans is set to expire, and without a refinancing in place, some banks could technically call in their loans. That scenario may be unlikely, but it's not off the table. To sweeten the deal, New World threw in Victoria Docksideits crown jewelinto a collateral pool that already holds around 40 assets. Warning! GuruFocus has detected 8 Warning Signs with NDVLY. Behind closed doors, the company's been working this out with lenders since January. The original deadline for banks to commit was late May, but several lenders reportedly need more time to clear internal approvals. In the background, New World also faces at least $116 million in perpetual bond coupons due in June. Under bond terms, it must notify investors 510 days in advance if it plans to defer any payments. That's one more timer ticking down for bondholders watching closely. And the pressure's not just short term. New World recently passed on a chance to redeem a $345 million perpetual bondbefore it resets at a higher rate. Instead, it's now considering a fresh HK$15.6 billion loan, using Victoria Dockside as a first-ranking mortgage. The company closed 2024 with HK$210.9 billion in total liabilities. How this refinancing unfolds could be a major litmus testnot just for the company's balance sheet, but for broader investor sentiment on Hong Kong real estate debt. This article first appeared on GuruFocus. Sign in to access your portfolio
