How to evaluate Evergrande and Xu Jiayin? Huang Hongsheng, Li Guoqing, Dong Mingzhu, Cao Dewang, and Hu Xijin said so

Recently, China Evergrande announced that Xu Jiayin, chairman of the board of directors, has been taken compulsory measures in accordance with the law because of suspected violations and crimes. Evergrande, once a trillion-dollar business empire, has fallen into crisis, which has aroused widespread concern in the past two years, and many well-known entrepreneurs and media people have expressed their views on Evergrande and Xu Jiayin.

Skyworth founder Huang Hongsheng: Xu Jiayin openly took Chinese people as enemies and deceived the country and deceived the people

Xu Jiayin openly made enemies of the Chinese people, wooing hostile forces to unbundle trillions of debts, and thus embarked on the road of hostility.

I have a friend whose 40 billion was cheated out by Evergrande. He knew that Evergrande was a listed company and very rich, so Xu Jiayin told him, we are the king of real estate, land is worth a lot, you deposit money with me, return 15% per year. As soon as my friend saw that 15% was really good, and there was Xu Jiayin's guarantee, he lent it to him, but not only could not get a penny of interest, but the principal disappeared. My friend didn't eat or sleep in the office, he spent 10 days in the office, and he almost jumped off the building, and he was freed from his predicament when I met him the other day.

I also have a good friend, the founder of a certain group, who invested 20 billion yuan when Xu Jiayin was in difficulty, and as a result, Xu Jiayin dragged a certain group into bankruptcy.

Recently, Xu Jiayin was criminally detained, guess what taboo he committed? He used U.S. law for bankruptcy protection. Because his wife and son immigrated to North America, they turned their assets from Chinese assets into his personal assets in the United States through borrowing money and so-called debt issuance, and then wanted to protect his American assets. This is to throw debts to China, leave assets in personal names, and use the confrontation between the United States and China and the political politics of the United States to solve the trap, which is to be the enemy of the people and the country.

He owes 700 billion to the bank, 700 billion to the supplier, and 700 billion to the owner, and owes three 700 billion, so time for space, I know that Jiangsu has a very famous enterprise, that is, give 15 years to repay the debt, how can there be a chance to turn over in 15 years, right?

The interest of these 15 years is not wanted, and the state's protection of enterprises and private enterprises is still much better than before, but you Xu Jiayin openly made enemies of the Chinese people, and wanted to unbundle your debts of several trillion yuan, so you embarked on the road of hostility.

If there is a difficulty, you must sincerely solve the difficulty. Because your country is in a mess this time, and how many tens of thousands of people have bought your house, and how many tens of thousands of suppliers have also suffered? To share a common fate, you have to exchange time for space, instead of you playing a game of deception, so that your wealth is protected, the country suffers, and the people suffer, you are heading for such a dead end, right?

On the contrary, Huawei encountered this kind of US suppression, but Huawei unswervingly did not discourage and did not give up, but made efforts in these software and chips urgently needed by this country to win the trust of the market and the government. Then you see that Huawei's difficulties have survived the disaster for a few years, facing a new path, and the sun is shining, so we as Chinese must not be selfish to encounter difficulties, and come up with this kind of deception of the country to deceive the people, you are called self-destruction.

(Content source: Huang Hongsheng from media)

Li Guoqing on Evergrande: Real estate developers kidnap banks, kidnap the government, and return it to society after the thunderstorm

The business model of real estate determines who wants to become bigger, and I am afraid that this is the case. Because the model of real estate developers is to kidnap banks, kidnap governments, and return them to society after thunder.

I once spoke with Feng Lun with MIT's Sloan Business Dean, and Feng Lun asked why there are no American real estate tycoons on the wealth list, and there are no listed real estate companies. The dean of the Sloan School of Business said that the regulation abroad is very serious, real estate developers do not do much, and they do not give shareholders more returns, so there is no rising value. In foreign countries, pre-sales account for 10% of the entire real estate cost, bank loans account for only 30%, 60% are investors contribution, and the number of rich people is limited, so the expansion is slow, and finally formed the real estate pattern in the United States: although slow, but not easy to explode, because real estate also fluctuates with the economic situation, house prices even if the waist is cut, banks are safe, 10% of customers are safe, and the most insecure are shareholders and people who do this real estate.

It is difficult for foreign real estate to expand and list, and another reason is that real estate is not only a small profit, but also the project has no technological content, choose the right position, follow the right market can earn more, when the market is unlucky, it will lose.

China has also done a lot of supervision, such as stipulating bank installment loans, but in actual implementation, many large banks give customers housing loans without capping. And these final consequences are borne by the buyer, if the contract is still in place after the house is finished, the buyer has to continue to repay the mortgage, and if it is not paid, it is a violation.

Evergrande's debt of more than 2 trillion yuan, the real debt to the bank is only 300 billion, and then the customer installment payment of 700 billion, this proportion is super large, that is, the bank does not cap the installment payment. There are actually 700 billion yuan in advance funds to contract construction projects, and this is how he came with this 2.4 trillion yuan, 700 billion plus hundreds of billions of bills, and the small 1 trillion yuan is owed to upstream suppliers, not only to build buildings, that is the hard-earned money and lifeline of migrant workers, including even the marketing expenses of advertising companies.

So this is the Chinese model that has shaped this kind of rushing real estate company, with a debt ratio of 70% and a current asset-liability ratio of more than 100%.

The microscopic problem is that Xu Jiayin is confused, no one Pan Shiyi and other shrewd, in the context of "housing is not speculation" is still blindly expanding, but Xu Jiayin is so shrewd, so many giants and rich money are circled, why would he make such a low-level mistake? First, the rapid development of real estate, if you use the Western model, it is impossible to have such rapid development in the past 30 years, every city has been rebuilt upside down, and China has achieved this speed of construction, and the people's desire to improve their lives has been realized so quickly, so the people have promoted him to have the desire to improve. Second, the government has an incentive to sell land, and more and more money is being sold for land, and even two-thirds of the financial expenditure of big cities depends on the income from land sales, so he is encouraged to hurry up and get money to build buildings, which leads to today's situation.

(Content source: Li Guoqing self-media)

Feng Lun: The enlightenment given to us by the "Evergrande disease" is that company founders should not have the privilege to go beyond the framework of corporate governance and do whatever they want

Evergrande's enterprise has indeed been in mortal danger until now, and it will definitely go bankrupt. So, I think there are several main reasons for the poor pool of financial data:

The first is the reason for the accounting adjustment. How does Evergrande recognize revenue? If it is strictly according to the recognition of revenue at the time of delivery of real estate projects, then Evergrande's turnover in that year should not be so much.

For example, if Evergrande has a debt of 800 billion yuan, but 200 billion of the 800 billion is recognized in revenue, then the liabilities become 600 billion, the revenue becomes 200 billion, the statement will look much better, the income will increase, and the liabilities will decrease.

Therefore, in the past venture of Evergrande, in fact, the mouth for recognizing revenue is loose, and there are even rumors in the industry that people from accounting firms take a look and recognize revenue as long as the project façade is completed. As we all know, there is at least a year left from the completion of the façade to the completion of the inner hardcovering, so it is equivalent to a large amount of early recognition of revenue from Evergrande, so that the report income becomes very large, which is convenient for financing from the capital market and stock market valuation.

The second is business strategy. Evergrande's business strategy is basically high leverage, high turnover, high debt, once the high turnover stops, high debt becomes poison. As long as you don't sell the house now, and there is no cash back, the interest will continue to rise, and the more you deal with debts, the more you pay back. Calculate that a trillion liabilities, the annual interest alone is one or two hundred billion, the "three highs" strategy is not stopping, as long as it stagnates, it will eat back, exposing huge financial loopholes.

Third, Evergrande's diversified expansion has made financial control lose the necessary governance rationality.

Why didn't Vanke and other enterprises explode? Because it is dominated by professional managers, while shareholders participate in governance and constraints, and the company culture has unique healthy genes, the business is not too diversified.

So you see, Evergrande made tens of billions of cars, hundreds of billions of gone, before still making water, grain, these all make its financial resources scattered, at the same time the core competitiveness can not continue to accumulate and preserve, corporate governance out of balance, and then the power of entrepreneurs, leaders, actual controllers is not financially constrained, the entire company will appear such financial results.

In addition, the founders of private enterprises are indeed very important to corporate governance, and must be in a good governance structure to ensure the long-term stability of enterprises.

The "Evergrande disease" also gave us a revelation, that is, private enterprises do have to strengthen their own corporate governance, you cannot say that you are an entrepreneur, have founded a business, have had some particularly brilliant performance, have the privilege to go beyond the framework of corporate governance, and do whatever you want.

(Content source: Feng Lun Fengma Niu "Feng Lun: How did Evergrande's 2.4 trillion debt owe?) 》）

Hu Xijin: Xu Jiayin should not try to "get rid of the golden cicada" and continue to enjoy wealth

How Evergrande got to this point is a matter of opinion. But if Evergrande comes to bankruptcy liquidation, or reorganizes a mess into the name of other responsible entities, Xu Jiayin himself will definitely be to blame. He may use the weapon of law to protect himself, and the law also protects the bankrupt. But it has caused such a big loss to the society, Xu Jiayin should not try to "get rid of the golden cicada" and continue to enjoy wealth. Whether there is criminal responsibility in this should be verified according to law based on facts, but at the civil level, Xu Jiayin should once again become a commoner who no longer has more than ordinary people's property. This is axiom and the bottom line of morality.

(Content source: Hu Xijin Weibo)

Ren Zeping: He was criticized at the company's cadres meeting for his advice on reducing debt and opposing diversification

I joined Evergrande in December 2017 with the intention of observing and studying real estate and private enterprise operations closely as an economist, which I didn't know much before.

Not long after joining the company, Evergrande's debt ratio has risen sharply to 86.25%, and it plans to diversify and expand significantly. Seeing this situation, I wanted to be able to speak up and contribute to this company, the industry, and society.

In the company report provided by the research institute in February and April 2018, I clearly put forward the advice: "Preventing and resolving major risks is the first of the three major battles in the next three years, and no market entity should take chances; Prevent and resolve major risks, mainly financial risks, fiscal risks, real estate risks, etc.; Potential risks: tightening financial conditions, tightening and expensive funds, and the risk of rupture of the capital chain of small and medium-sized housing enterprises." "We may be entering a new stage of real estate development, and we must fully estimate the determination and impact of a series of major measures such as 'housing instead of speculation', long-term mechanisms, and rent-purchase simultaneously, and change concepts and deepen transformation."

Maybe it's a bit bookish, but those who know me well know that I've always had a clear-cut, direct, and straightforward personality. Not long after joining the company, I also spoke in front of several key leaders of the company about reducing debt and opposing diversification, because it is clearly written in the history of domestic and foreign enterprises that diversification mostly fails, which can be described as nine deaths.

However, my advice on reducing debt and opposing diversification was criticized at a meeting of company executives, and I was criticized for a long time, which roughly means that I did not have enough to understand the company's major strategy.

Many of Evergrande's executives and employees know this. When I first joined, I was going to make a difference, but I encountered a setback, which hit me a lot, and many people, including me, didn't know enough about the corporate culture.

In the second half of 2020, I felt that I had made due advice and efforts, but it was difficult to integrate because words did not work. Coupled with the determination and strength of judging the state's regulation and control of real estate, the era of real estate is about to pass, and academic research is more suitable for me, so I proposed to leave.

I think Xu is always a very entrepreneurial person, he has a spirit of adventure, and we should not easily judge as a success or failure. After all, people have been quite successful in the past twenty years, and there are reasons for success.

I think Mr. Xu is still a very patterned person, I put forward different opinions, even when I was in Evergrande, I was also a few, not to say that I was the only one, or a few dared to put forward different opinions, based on their own professional views, whether right or wrong, I think Mr. Xu can still listen.

But let's be objectively speaking, because as a business, in the end, you have the authority to advise, because you will not be responsible for the final result. Who is responsible for the final result and who approves, as for the rumored slap on the table, that did not happen.

(Content source: Zeping Macro "Advice, Truth and a Few Words from the Heart", Ren Zeping Live Broadcast)

Dong Mingzhu: The country cannot be called the "richest man", and spiritual prosperity is also very important

People like to measure a person by money, and now a lot of people talk about rich people, you look at the media reports about what is the richest man, and then what is a successful person, say how much money you have. You see that now they are all thundering, pit the country pit the society, what is this called rich? We understand this "rich" as wealth, spiritual abundance is also very important, without spirit there can be no wealth, you are like a walking corpse, pigs lie there eating and drinking, drink well and eat well, is it rich?

(Source: Interview with Dong Mingzhu)

Cao Dewang: Xu Jiayin's own capital of 3.9 billion yuan has achieved 2,000 billion yuan in loans, and individuals should adhere to the ancestral motto of respecting heaven and loving people

Xu Jiayin has a total of 3.9 billion yuan of his own capital, and the loan can reach 2 trillion yuan, which is Chinese-style finance. When we learned from the United States, there may be punctuation marks that did not look at the learning well, and the expression was not very clear, and this happened.

We should adhere to the group training of respecting heaven and loving people, as Mr. Wang Yangming said. You must adhere to this principle, not greedy, step by step, if you want to dig up other people's hearts, you should worry about whether you will be dug by others.

(Source: Cao Dewang gave a speech at the 9th China Entrepreneur Development Annual Conference 2021)