Yanlord Land

[learn2win]

Actually, Yanlord has a very good name in China and is one of the better developers in China.

They do have very good projects. More importantly, their after sales maintenance of the property is very good. The lawns are well maintained, the club-house well run. It's a self sustained community with a post office, travel agency, a massage centre, hair saloon, convenience store etc.. inside the compund.

The incident happened in 2001. I really wonder how come this kind of news will never be out during good times, but only out in lousy period like now.

[iam802]

Trading halt already.

[Aspellian]

remembered that yanlord was rallying and one of the better performer in share price a couple of days back. could it be someone already knew the "bad news" and boosted the share price up so he can offload? just some wild thinking on a wednesday afternoon.

[iam802]

This is hindsight theory .... but I would treat it as a constant reminder.

For every big rally, one would never know what is the ultimate outcome. It is always important to be vigilant.

Let's go through Yanlord... and how I would possibly have trade:

1. Sept 19
The big rally that closes at 1.47; breaking through a previous gap and a resistant line at 1.46.
Assume one has bought at that day at the high of 1.47

2. Sept 22
Open 1.51 but close 1.36. The price range for this sell down is also very wide and it break through the support at 1.46 and also the previous gap at $1.38. In this case, I would have cut loss and move on. (So, about $0.10 loss per share).

3. Sept 23
If one has not cut on Sept 22, then Sept 23 would have been further signs of weakness and should have taken action. If one sell on Sept 23 close price, loss would be $0.20 per share)

4. Sept 24
Today.... halted at $1.04

On a personal note, without going into TA, I would personally avoid property counters. Overall economy is weak, property counters will not be on my priority.

[winston]

Not vested.

Singapore-listed Yanlord denies China graft reports

SINGAPORE, Sept 25 (Reuters) - Yanlord Land , a developer of luxury homes in China, said on Thursday that Chinese media reports linking it to graft charges against a senior Chinese government official were untrue.

The company said Kang Huijun, a former vice governor of the Pudong New Area who is now on trial in China, had together with his family lived in Yanlord Gardens in Shanghai's Pudong district since buying an apartment unit in 2001.

Kang later traded in his old unit for a larger one in the same development in March 2006, Yanlord said.

"In consideration of the publicity benefits that Mr Kang's residency would bring towards the sale of apartments at Yanlord Gardens", both units were transacted based on initial launch prices, the developer said.

"The Group reiterates that the above transactions fall within the ordinary course of its business involving sale and promotion of our apartment units," Yanlord said.

The company also denied media reports that between 1993 to 2001, Kang abused his capacity as vice governor of the Pudong New District by giving Shanghai Yanlord land use rights to sites for development into Yanlord Gardens.

"The Company wishes to state categorically that the above statement is untrue as Shanghai Yanlord did not receive any assistance from Mr Kang in obtaining the land use rights of any land parcels," Yanlord said in the statement.

Yanlord shares dropped by more than a fifth to S$0.99 on Wednesday before a mid-day trading halt.

Resuming trading on Thursday, the shares fell more than 9 percent to a life low of S$0.945.

[winston]

Not vested. From DMG:-

Yanlord shares hit by graft trial of China ex-official

Shares of Yanlord Group went into a tailspin yesterday, hurt by market rumours linking it to a corruption trial in Shanghai involving a former Chinese official. Following a request by Yanlord, share trading was halted at 2 pm, pending an announcement in response to the market talk.

But the stock had by then plummeted as low as 99 cents before ending the morning session at $1.04, down 22 cents or 17.5 per cent. According to a China magazine, Caijing, the group allegedly allowed a former Shanghai official - currently on trial for suspected corruption - to buy an apartment at a price substantially below market levels.

Caijing said in an online report that Yanlord allegedly allowed Kang Huijun, former deputy chief of the Pudong district in Shanghai, to buy a luxury apartment at Yanlord Riverside Garden in the prosperous Lujiazui area, at a steeply discounted price of 8,300 yuan (S$1,719) per square metre in 2001, at a time when the prevailing market price was 11,000-12,000 yuan per sq m.

In 2006, Yanlord allegedly bought back the apartment from Kang at a price of 8,300 yuan per sq m and later sold him a larger
apartment measuring over 300 sq m at the same price. The gap between purchase price and market price totalled about 4.89 million yuan, according to Caijing.

Kang was reportedly detained in November last year because of allegations that he used his position to help Yanlord secure land use rights to several plots of land in Pudong. He has been accused of taking bribes worth a combined 5.99 million yuan in six separate instances and was alleged to have 11.84 million yuan of personal property of unexplained origin.

The official was also the general manager of Lujiazui Group, a government company that is in charge of developing the Lujiazui financial district in Pudong. Kang was also said to be accused of helping Yanlord to gain permission for blocks SB4-1, 2, 3 and 4 as well as SB5-1 and 2 in Pudong.

The Shanghai Daily reported earlier yesterday that government prosecutors alleged that the former deputy chief of Shanghai's Pudong district accepted a 189 sq m apartment at the Yanlord Gardens complex in exchange for help in securing land development rights.

Besides the Yanlord case, Kang also allegedly received bribes from staff and friends in exchange for offering employment or providing other 'inappropriate' assistance, Caijing said.

Source: Business Times

[Aspellian]

wonder what will be the implications to Yanlord? financial impacts? original land sites linked to the bribery being confiscated? a heavy fine or more bribes required to cover the previous bribes uncovered?

so did the market over-reacted and oversold on Yanlord?

[winston]

so did the market over-reacted and oversold on Yanlord?

The Chinese Property Developers are having a tough time now. However, Yanlord does has a good name and their projects are normally well received..

[Aspellian]

so did the market over-reacted and oversold on Yanlord?

The Chinese Property Developers are having a tough time now. However, Yanlord does has a good name and their projects are normally well received..

i remembered this could be similar to Buffet's purchase of Amex when there was a scandal involving the CEO and market reacted negatively but fundamentally Amex is a good brandname. From Winston's experience, Yanlord is a good brand. I remembered a few analysts also mentioned that Yanlord is one counter they will love to have in their portfolio.

So the question is whether this is a buying opportunity now? 802 mentioned that he will not touch property counters, which has its own arguments esp. with a slowdown in global economy, properties will not sell well. But is the situation the same in china? if there is indeed a slowdown, the best to profit is a brandname. . .

[winston]

Not vested. From CIMB:-

Lowering our earnings forecast and NAV. In view of the recent contraction in sales volume in the property market, we expect presales momentum to slow down in 4Q. We cut our earnings forecast for FY08-10 by 16-24% on a slower completion schedule and lower ASP. Our RNAV is lowered from S$3.42/share to S$2.65/share.

• New measures in Nanjing should be positive. On a positive note, the Nanjing government recently issued new measures for the property sector, which should help boost the demand for properties in Nanjing and therefore benefit Yanlord’s development projects in Nanjing.

• Minimal earnings impact from the bribery case. Yanlord issued a clarification in response to some media articles associating Shanghai Yanlord Property to the graft charges raised against the former vice governor of Pudong. We believe Yanlord’s development rights of its existing landbank should be unaffected and earnings impact should be minimal.

• Maintain Outperform with lower target price. In view of the de-rating of the sector, we tag a wider discount of 50% instead of 10% previously. Share price correction was over-done due to negative sentiment from the bribery case. Ongoing
presales and the launching of more units of the Shanghai project should act as catalysts. Maintain Outperform as we lower our target price from S$3.07 to S$1.32.