China to fight fires with contingency plans

China's cabinet has vowed to stabilize the economy and called on officials to avoid measures that harm market expectations.

And the chairman of Vanke (2202), Yu Liang, believes that more positive policies will be introduced in the property sector.

A State Council meeting led by Premier Li Keqiang on Wednesday called on the nation to prioritize stable growth and to draft contingency plans to deal with possible greater uncertainties. This came as China's official manufacturing Purchasing Managers' Index fell to a five-month low of 49.5 in March from 50.2 a month earlier.

On the real-estate sector, which contributed a quarter of China's GDP, Vanke's Yu said yesterday that he expected more positive policies to be introduced at the local levels to stabilize the property market.

However, some developers interviewed by Reuters said they could not get new bank loans.

This came as China Overseas Land and Investment (0688) saw its 2021 net profit drop by 8.5 percent to 40.2 billion yuan (HK$49.6 billion) from a year ago and proposed a final dividend of 76 HK cents. Revenue for the same period rose 30.4 percent to 242.2 billion yuan, with income from commercial properties up 17.4 percent.

Meanwhile, China Resources Land (1109) reported an 8.7 percent increase in net profit to 32.4 billion yuan last year and plans to distribute a final dividend of 1.207 yuan. Revenue for the same period grew 18.1 percent to 212.11 billion yuan. Net profit at its property management unit, China Resources Mixc Lifestyle Services (1209), more than doubled to 1.73 billion yuan last year, with a final dividend of 0.276 yuan per share, up 109.1 percent year-on-year.