Bonds show 60% of Chinese companies dabble in property

The Sydney Morning Herald reports:

Almost 60 per cent of Chinese companies that sold bonds in the past six months invest in the property market, undermining government efforts to limit real estate fundraising and curb inflation.

Seventy-four of 121 companies that filed bond prospectuses since May with Chinabond, the nation's clearinghouse, count one of their main businesses as real estate, have property subsidiaries or invest in the market. Engine maker Zongshen Power Machinery Co. said its parent company is involved in development. Kangmei Pharmaceutical Co., which makes medicine to treat high blood pressure, invests in real estate.

While property values dropped in 33 of 70 cities in October, the most in 2011, home prices rose 2.9 per cent in the past year in Shanghai and 4.4 per cent in Shenzhen.

Read more: http://www.smh.com.au/business/world-business/bonds-show-60-of-chinese-companies-dabble-in-property-20111124-1nw20.html