State players the winners in mainland China property markets, analysts say
Some smaller private developers losing market share
State juggernauts have been the winners during the tough times for mainland China’s property markets since last year, with state-owned developers gaining more market share and achieving stronger growth than their private-sector peers, experts say.
They predict the trend will continue in the fourth quarter, with quality state-owned players set to benefit more from government policy support, and recommend selling listed private developers with high leverage or slowing growth.
Among the 36 major listed mainland property developers in the H-share and A-share markets, 10 key state-owned firms have attained faster market share growth than their private counterparts, with their total market share up to 10.1 per cent in the first nine months of this year from 8.8 per cent in 2014, Deutsche Bank analysts Tony Tsang and Jason Ching said in a report on Monday.
The state players included China Overseas Land & Investment, Poly Real Estate Group, China Resources Land, Greentown China Holdings and China Merchants Property Development.
Even among the listed developers, the state-owned developers are gaining market share
A number of leading private developers, including Dalian Wanda Commercial Properties, Country Garden, Shimao Property, Sunac China, recorded declines in market share during the same period, the report added.
“In the past, industry consolidation in the China property market was mainly characterised by the listed developers taking market share from the unlisted developers,” they said. “However, starting 2014, a new phenomenon has emerged – even among the listed developers, the state-owned developers are gaining market share, while most private developers (especially the small- to mid-caps) are no longer gaining market share, or are even losing share.”