(Yicai Global) April 13 -- The stock price of Sunac China Holdings more than halved on the first day after trading in the Chinese property developer’s shares resumed, bringing a 377-day suspension following its debt default to a close.

Sunac [HKG: 1918] closed down 55 percent at HKD2.04 (26 US cents) today. The shares had ended at HKD4.58 apiece on their last trading day before the halt on March 31, 2022.

The Hong Kong Stock Exchange gave the go-ahead for trading in its shares to resume, the Tianjin-based builder said yesterday. Sunac has been undergoing restructuring domestic and offshore debts, released its overdue 2022 earnings report, and resumed share trading, all important milestones in the firm’s recovery, it added.

The resumption is a landmark event for Sunac on its road to recovery and will drive a pickup in the company’s stock liquidity despite inevitable volatility, according to analysts.

As a leading property developer, Sunac’s trading resumption can enhance the confidence of other debt defaulters to overcome difficulties and boost the overall market, said Liu Shui, head of business research at the China Index Academy.

In the next few months, more property developers will resume trading after achieving significant progress in debt restructuring and make substantial improvements in defusing debt risks, Liu said.

A total of 36 Chinese property developers have defaulted on debts. Trading in the stocks of 14 Hong Kong-listed Chinese real estate companies are still suspended.

Sunac’s net loss narrowed nearly 28 percent to CNY27.7 billion (USD4 billion) last year from 2021, while revenue slumped 51 percent to CNY96.8 billion, according to its annual financial report released on March 31. The company’s net assets totaled nearly CNY1.1 trillion (USD160 billion) as of Dec. 31.

On March 28, Sunac published a restructuring plan according to which offshore creditors holding over 30 percent of the total outstanding principal of the firm’s USD10 billion of offshore debt could choose between a number of options, including swapping old notes for new ones, the partial conversion of debt to shares of its property management arm Sunac Services, and the issuing of convertible bonds.

Sunac will likely obtain at least 75 percent of affirmative votes for the plan and complete related legal procedures by the end of the year so that the winding-up petition may be withdrawn, according to industry practice.

Editor: Futura Costaglione