Evergrande nears sale target for full year

Evergrande Real Estate Group said it would achieve its full-year sales target of 70 billion yuan (HK$85.22 billion) next month despite the mainland's weakening property market.

In the first eight months, the group's contracted sales - sales completed but not yet booked - amounted to 60 billion yuan, equivalent to 85.9 per cent of the group's full-year contracted sales target. The gross floor area of contracted sales amounted to 8.94 million square metres.

'By October, I believe we will have achieved the full-year sales target of 70 billion yuan,' said chief executive and vice-chairman Xia Haijun. Xia said the company had no plans to reduce selling prices. Analysts had forecast developers would cut prices to boost sales volume when they launched more new projects later this month and in October.

Rather, Xia said the company would consider increasing selling prices when the full-year sales target had been achieved.

The company would launch 10 new projects in September and October, providing up to 1.3 million square metres of gross floor area.

Contracted sales prices fell modestly month-on-month to 6,267 yuan per square metre, compared with July's 6,327 per square metre.

Xia said three new projects were launched last month, and the company usually adopted a 'competitive' price strategy when it launched the first development phase.

Average selling prices were up by just 8 per cent in the first eight months, compared with the same period in 2010, while total contracted sales have jumped 97.1 per cent.

Evergrande, with more than 26,000 employees, has 95 projects on the market. Those projects span 54 mainland cities, among which are 38 that have imposed restrictions on the number of homes people can buy.

However, Xia said the restrictions did not have a significant impact on their sales because the projects targeted first-time buyers.

Last month, Evergrande reported first-half net profit, excluding revaluation gains from investment properties, amounting to 4.81 billion yuan (HK$5.88 billion), an increase of 147.9 per cent from 1.94 billion yuan in the year-earlier period.