China State Construction sales jump in 1Q, start slowing

SHANGHAI: China's biggest homebuilder, China State Construction Engineering Corp (CSCEC), posted big gains in its construction and real estate business in the first quarter, but growth slowed in March in response to government curbs.

The value of CSCEC's new construction contracts rose 70.6% to 98.2 billion yuan (RM46.3 billion) in the January-to-March period from a year earlier, the company said in a statement to the Shanghai Stock Exchange on Tuesday (April 13). That compared with 85.3% growth in the first two months.

Real estate sales rose 43.3% from a year earlier to 13.1 billion yuan, CSCEC said. That marked a slowdown from 71.5% growth in January to February.

The property sector has come under increasing scrutiny from policy makers in Beijing, who are worried about rising prices and the potential for a lending spree last year to turn into a fresh crop of bad loans.

The top banking regulator, Liu Mingkang, said on Sunday that banks must report on the quality of their loan books by the end of June and take fresh steps to rein in risky lending to land developers.  

Concerns over further tightening for the sector sent the shares of property firms lower on Monday. CSCEC shares fell 0.93% on Monday, better than a 2.6% slump in the Shanghai property index but underperforming the benchmark Shanghai Composite Index - Reuters