The rating on Zhong An Real Estate Ltd. reflects the company's small scale and high geographic and project concentration compared with its rated peers', the execution risk associated with its somewhat aggressive expansion, and its exposure to China's real estate market, which is cyclical and competitive, with evolving regulations. Zhong An's small scale and high concentration may lead to high volatility in its financial performances. The company's track record of disciplined financial and risk management, good local knowledge, low-cost land bank, and established market position in Hangzhou temper these weaknesses. We view Zhong An's small scale and high geographic and project concentration as major constraints on the rating. Currently, 56.7% of the company's land bank is in Hangzhou. Although the...
Companies mentioned in this report are: Zhong An Real Estate Ltd.,China SCE Property Holdings Ltd.
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