China Evergrande shares rise on vow to boost unit construction

By Clare Jim

(Reuters) -Shares in China Evergrande Group jumped more than 8% on Tuesday morning after the embattled property developer said it had made initial progress in resuming construction work.

Company chairman Hui Ka Yan vowed in a meeting on Sunday to deliver 39,000 units of properties in December, compared with fewer than 10,000 in each of the previous three months.

Evergrande, grappling with over $300 billion in liabilities and at risk of becoming China’s biggest ever default, has been scrambling to raise cash by selling assets and shares.

The firm missed a deadline to pay offshore coupons worth $82.5 million earlier this month, threatening to trigger cross-default on its roughly $19 billion of international bonds.

Fitch and S&P downgraded Evergrande to “restricted default” and “selective default” respectively following the missed payment.

Evergrande has new coupon payments worth $255 million due on Tuesday for its June 2023 and 2025 notes.

As of 0200 GMT, Evergrande shares were trading up 7.4% at HK$1.59, a one-week high, while the eased 0.4%.

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