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Xinyuan Real Estate Co., Ltd. Message Board

  • yinvestor yinvestor Sep 16, 2013 11:30 AM Flag

    Market is at all time high...

    Market is at all time high.
    This stock has tripled this year.
    This company just issued $200M bond at 13.25% high annual interest rate this April.

    Most Chinese real estate is now 5 - 10 times higher than 10 years ago.
    Most Chinese people can not afford to buy a apartment since the apartment is 80 times of their
    annual income. The huge real estate bubble is due for a big burst for long time.
    There is no exception, a bubble will burst, the bigger the bubble, the worse the burst.
    All the reserved land will depreciate greatly if the bubble is coming.

    The new property tax will be the trigger of the burst of the huge real estate bubble in China.
    Can you imagine there is no property tax in China right now? There will be for sure.

    You might say this stock has high level of cash and book value.
    But can you believe its cash level and book value and financial report while it's raising money at 13.25% annual interest rate? Can this company survive the huge bubble burst?

    I would be very cautious on this one.
    If all the financial reports, cash level and book value are real, at least from technical point of view, this stock is over bought, it's very likely to retreat to $5 level.

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • I need to correct myself that this stock did not triple this year but in the past 2.5 years but it's still way undervalued. I am in hoping for a 100% return in a year.

    • So....can you believe the cash level and financial report while raising money at 13.25% annual interest rate?
      Can XIN survive the huge bubble burst like you say? Are we in the burst now?
      Do you still feel it is likely to retreat to the $5 level?

      • 1 Reply to star_hominid
      • Yes, I believe its cash level and financial report after my investigation.
        I think XIN could survive the huge bubble burst if there is one due to its good management and most of its properties are in tier two cities and the fact XIN does not have too many land reservation has become its advantage.
        I think there is a slight chance it could retreat to $5 but it would be a good buying opportunity.
        But I am already in and hope it would get to $10 in three to six months.

    • When do you expect the bubble to burst? Has the property tax initiated the burst already?

      Will all the XIN reserved land depreaciate greatly very soon?

      If most Chinese people can not afford to buy an apartment since it is 80 times their annual income....how do you expect XIN to not have massive losses?

      How much higher can Chinese real estate go if it is 5-10 times higher than 10 years ago?

      • 2 Replies to star_hominid
      • The average selling price of XIN's projects is about 8000RMB, so 70 square meter * 8000RMB = 560000RMB, still a high number but much better than Beijing, ShangHai and Shenzhen.
        The same apartment in these city would cost 2MRMB or more.

        So XIN's properties are much affordable comparing those in large cities and most of its projects are 98% - 99% sold after a year or so.

      • I don't know when the bubble will burst but XIN is under valued trading at 50% of its book value.
        After my investigation, I found this company is trust worthy. Its report was audited by Ernst & Young so I believe that the company is now having $850M cash and $850M book value($12 per ADS).

        I still don't like the 13.25% high interest bond and I hope it would retreat to $5 but I don't think it's going to get there. If it ever gets there, I will double my holding.

        As to the land depreciation, I hope the company could speed up its development and not to hold all the lands for too long.

    • LOL! What XIN reserved land will depreciate greatly? XIN holds cash not land.

      " Housing prices in Beijing...... rose 22.5% in August from a year earlier, according to data tracker China Real Estate Index System "

      Are you saying Beijing doesn't have property tax?

      Can XIN survive the huge bubble to come in China?

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