With the deepening of the adjustment of the real estate market, Country Garden Holdings Limited recently announced that it will restructure its overseas debt to seek an overall solution to deal with possible overseas debt risks.
According to the announcement, Country Garden's overseas debt is about US$9.3 billion, which will be the second largest offshore debt restructuring case in the real estate industry. Prior to this, Country Garden has completed the overall rollover of domestic debt, and this offshore debt restructuring is undoubtedly its next important step.
However, in the face of such a large amount of overseas debt, Country Garden's situation is not easy. Sales in the real estate industry have not improved significantly, and Country Garden's sales have fallen by 80% year-on-year, which has undoubtedly put great pressure on the company's cash flow.
In this context, Country Garden's overseas debt restructuring plan is particularly important. Negotiating with creditors to find a holistic solution to debt can buy companies more time to find new growth opportunities in the trough of the industry.
However, debt restructuring is only the first step towards self-help. The recovery in sales is the key issue facing Country Garden. In the face of a sharp decline in sales, Country Garden needs to find an effective way to increase sales as soon as possible in order to maintain a strong financial position during the overseas debt restructuring.
Country Garden needs to adopt a flexible strategy to respond to the current market environment. On the one hand, existing resources can be used to optimize the allocation and improve the quality and added value of the project to attract more buyers; On the other hand, brand awareness and influence can be enhanced through innovative marketing methods and sales channels.
In addition, Country Garden can also consider working with financial institutions to seek more financing channels. This will not only ease short-term cash flow pressures, but may also provide more support for the company's long-term growth.
Overall, Country Garden's offshore debt restructuring plan is an important measure to cope with the current market environment. However, to truly save itself, the company needs to work more on the recovery of sales. Only when sales are substantially improved will Country Garden be able to regain a stable development path in the highly competitive real estate market.