In the past two years, the domestic real estate market has been turbulent. Huaxia Happiness was once a well-known real estate giant around Beijing, with a debt of 91.8 billion yuan, and the project has long been discontinued; Tahoe Group, which specializes in the development of luxury homes, also has a large number of unfinished projects due to capital breakdowns; Domestic real estate leader Evergrande Real Estate is now caught in a debt storm and is recovering money by selling assets and selling homes at low prices. It can be said that because the state has drawn three red lines, many housing companies have had a hard time in the past two years.
Speaking of Guizhou, many people may not know that as early as 1994, the first listed company was born in Guizhou, and it was also a real estate company. This Guizhou real estate company went public earlier than many domestic real estate companies, and soon became the largest real estate company in Guizhou. This company is now listed Zhongtian Financial, and the actual controller is named Luo Yuping. Today, Zhongtian Financial is selling its real estate business as its parent company is on the verge of bankruptcy.
Luo Yuping's life experience is very legendary. Luo Yuping, born in 1966, entered the construction industry after graduating from Chongqing University. In 1988, Luo Yuping accidentally undertook a project and earned his first pot of gold with this contracting project. After tasting the sweetness of the construction industry, he invested all his savings in the real estate market in 1992, and later established Jinshi Qi International in 2005, mainly engaged in real estate business.
In the past 20 years, real estate is in a dividend period, and Luo Yuping has made a lot of money from it. In 2007, Luo Yuping took over the listed company Zhongtian City Investment through restructuring and became the richest man in Guizhou with a value of 9.5 billion. Since then, Zhongtian City Investment has changed its name to today's Zhongtian Finance.
After receiving the support of the capital market, Luo Yuping's real estate business soared. With the support of a large amount of funds, a number of real estate projects started construction at the same time, and the business entered the fast lane of development. He has created many famous projects in Guizhou, such as Zhongtian Square, and it is precisely because of this that Luo Yuping was ridiculed by netizens as "Luo Bancheng", suggesting that he bought half of Guizhou.
In 2008, Zhongtian's real estate business revenue was only 880 million yuan, rising to 1.556 billion yuan in 2009, and exceeded the 10 billion yuan mark for the first time in 2014, reaching 10.96 billion yuan. In 2016, it reached 18.7 billion yuan. In addition, shopping malls and office buildings also brought in revenue of $6.6 billion. At the same time, in 2016, Luo Yuping realized that the real estate dividend period had passed, so he wanted to lead the company's transformation. Under Luo Yuping's vision, in 2015, Zhongtian Financial adjusted its business structure and established a development path of "insurance, securities, and banks as the main body, funds, asset management, diversified finance as the supplement, and real estate industry as the cornerstone" in just two years.
In 2018, Luo Yuping sat on the throne of the richest man in Guizhou. In 2019, Luo Yuping's wealth increased to 13 billion yuan, ranking 263rd on the Hurun Report, still firmly holding the throne of the richest man in Guizhou.
However, what Luo Yuping did not expect was that such a layout not only did not optimize the business structure of Zhongtian Finance, but also wasted a lot of cash flow, so that all the ones he got were "hot potatoes".
In 2016, Zhongtian Financial Holdings acquired and controlled Zhongrong Life, and subsequently acquired a 51% controlling stake through physical transactions. However, in 2016 and 2017, Zhongrong Life lost more than 2.2 billion yuan, and the sum of its net profit in the past three years was only 130 million yuan, of which the net profit in 2020 was only 14 million yuan. Since February 2018, the position of general manager of Zhongrong Life has been vacant.
In 2017, Zhongtian Financial's asset-liability ratio had exceeded 80%, and the entire company's market value was only 80 billion yuan, but it insisted on acquiring Huaxia Life, which had a net asset of 350 billion yuan. Zhongtian Financial Holdings negotiated with the shareholders of Huaxia Life. Agreed to acquire a 20% stake, so a deposit of 7 billion yuan was paid. However, Chinese Shou has since been miserably trusted. The acquisition is still in the foreseeable future. The 7 billion yuan may be lost.
To add insult to injury, the 2021 interim report shows that Zhongtian Financial's asset-liability ratio has reached 85%, the net cash flow from investment activities and the net cash flow from financing activities are negative, and the amount of current liabilities is as high as 47.3 billion yuan. Total debt amounted to RMB133.7 billion. In desperation, Zhongtian Financial can only choose to sell the real estate business, cash out the funds, and relieve the pressure of capital turnover. At present, the sale of real estate business to cash out 18 billion has not yet been completed.
At the same time, the market value of Zhongtian Financial has also plummeted, and it is now only 20 billion yuan. Luo Yuping's net worth has plummeted, and now there is only 5 billion yuan left. In addition, Luo Yuping was notified of criticism in January this year. On the one hand, because he did not buy back his shares as agreed, and on the other hand, to provide financial assistance for external violations. To put it bluntly, it is to engage in profit transmission. Zhongtian Financial's parent company, Luo Yuping Holdings nearly 75% of Jinshiqi International Holdings Co., Ltd., is even more precarious. The company has pledged 2/3 of its shares in Zhongtian Financial Holdings. Among them, Jinshiqi International Holdings Co., Ltd. has total assets of 165.8 billion yuan, total liabilities of 153.7 billion yuan, asset-liability ratio of 92.7%, and ownership equity attributable to the parent company of -3.089 billion yuan.
Jinshiqi International has downgraded its entity rating to AA- with a negative outlook, and the bond rating is only AA. According to the information disclosed by Jinshqi, there are as many as 120 lending institutions.
Luo Yuping has plummeted from the richest man in Guizhou to now, and the company is on the verge of bankruptcy. This also teaches domestic entrepreneurs a lesson, that is, honest business is the most reliable. The financial industry is not so fun, and it is not easy for the layman. Good play.