Wealth curve

Liu Yuxiong and his wife speculated that Evergrande had a hu

Hong Kong listed company Chinese Real Estate (00127.HK) announced this afternoon that the company expects its revenue in 2018 to fall 39% to 49% year-on-year, and its net profit dropped 68% to 78%. In addition, the fair value of Evergrande shares held by Chinese Real Estate decreased by HK$3.1 billion.
Chinese home ownership is actually controlled by the Hong Kong billionaire Liu Yuxiong. Liu Shaoxiong and Xu Jiayin have a deep friendship. From 2017 to 2018, Chinese Real Estate and Liu Yuxiong's wife Chen Kaiyun (Gambie) have continuously bought Evergrande shares and currently hold a 9% stake in Evergrande. Among them, Chinese Real Estate held 858 million shares, accounting for 6.57%; Chen Kaiyun personally held 315 million shares, accounting for 2.42%.
Some people interpret the announcement of today's Chinese home ownership as "Hong Kong's richest woman's richest man, Hengda's loss of HK$3.1 billion." It is a misunderstanding.
First of all, although Chen Kaiyun is an executive director of Chinese Real Estate, he is known as the "Hong Kong Women's Richest Man" in the market, but Chinese home buyers are still in the hands of Liu Shaoxiong. Liu Yuxiong holds 74.99% of the shares of Chinese Real Estate through the family trust. The beneficiaries of the family trust include Liu Yuxiong's wife Chen Kaiyun (Gambie) and the eldest son Liu Mingwei. Among them, Chen Kaiyun holds 50.02% of the shares of the two minor children, while Liu Mingzhen holds 24.97%.
The title of "the richest woman" by Chen Kaiyun is actually a misunderstanding of the family trust. In the 2019 Forbes Hong Kong Rich List, Liu Shaoxiong ranked fourth with a value of 17 billion US dollars, and did not see Chen Kaiyun's name.
Secondly, Evergrande shares held by Chinese Real Estate did not have actual losses, but adjusted the “unrealized fair value” according to the 2018 stock price change, that is, the current year’s floating loss. China Evergrande's share price in 2018 fell by 8.4%.
Chinese home buyers began buying China Evergrande in April 2017. By the end of 2017, they held 858 million shares and used funds of 13.2 billion Hong Kong dollars. The average cost per share was 15.38 Hong Kong dollars.
The announcement shows that at the end of 2017, Evergrande held by China Real Estate had a floating profit of 9.9 billion, and its floating profit decreased to 6.6 billion by the end of 2018.
However, the above figures do not include the Evergrande dividends obtained by Chinese home buyers. Evergrande paid dividends of HK$1.13 per share in 2018, and Chinese home buyers received a total of 1.1 billion Hong Kong dollars.
That is, Chinese people actually did not lose money, but they earned less on the books. Moreover, Chinese home ownership does not currentlyThrowing Evergrande shares, the specific profit in the future is still unknown.
Again, HK$3.1 billion represents only the change in the fair value of the shares held by the listed company Chinese Real Estate, and does not include the majority of Chen Kaiyun’s personal holdings.
Chinese Real Estate did not continue to increase its holdings in Evergrande in 2018, but instead was bought by Chen Kaiyun personally. Before April 4, 2018, Chen Kaiyun bought 197 million shares, and bought 119 million shares from April 4 to August 23, with a total investment of about 8 billion Hong Kong dollars. The average cost per share was about 25.4 Hong Kong dollars.
Based on the closing price of Evergrande on December 31, 2018, the closing price of Chen Kaiyun is less than 10%, that is, less than 800 million Hong Kong dollars. If you count the 350 million yuan dividend that Chen Kaiyun holds, the personal book is only a slight loss.
Finally, the significant decline in revenue and net profit of Chinese Real Estate in 2018 did not include the change in the fair value of Evergrande shares. Because the latter is attributed to “other comprehensive income” rather than operating income. The announcement shows that the decline in the performance of Chinese home buyers was mainly due to the decrease in sales properties.