China Evergrande Group has missed its third round of bond payments in three weeks, intensifying market fears over contagion involving other property developers as a wall of debt payment obligations come due in the near-term.
Some bondholders said they did not receive coupon payments totalling $148m on Evergrande's April 2022, April 2023 and April 2024 notes due by 4am this morning.
This follows two other payments it missed in September.
That puts investors at risk of large losses at the end of 30-day grace periods as the developer wrestles with more than $300 billion in liabilities.
A total of $101.2 billion bonds issued by Chinese developers will be due in the next year, Refinitiv data show.
"We see more defaults ahead if the liquidity problem does not improve markedly," said brokerage CGS-CIMB in a note, adding developers with weaker credit rating are having difficulty in refinancing at the moment.
Trading of high-yield bonds remained soft today following a rout in the previous session on fears about fast-spreading contagion in the $5 trillion sector, which accounts for a quarter of the Chinese economy and often is a major factor in policymaking.
Shanghai Stock Exchange data showed the top five losers among exchange-traded bonds in morning deals were all issued by property firms.
Small developers Modern Land and Sinic Holdings were the latest scrambling to delay deadlines, after Evergrande and Fantasia missed their payments since September.
Modern Land, whose shares dropped over 3% to new low today, had requested bondholders on Monday to delay a repayment due later this month for three months, while Sinic said it would likely default next week.
Fantasia Holdings' unit limited trading in its Shanghai bonds yesterday, which is often done ahead of defaults.
While global attention has been focused on missed dollar debt payments by Chinese property issuers, market indicators suggested that worries about contagion and a slowing economy are spreading further.
Market players say the sell-off, however, appears limited to more riskier bond names.
"The market is trading more rationally now, according to different quality and rating of the companies, rather than selling off on the whole sector," said Michael Wong, director at CP Securities based in Hong Kong.
Shares of several other property firms, however, fared better as markets bet on more loosening of policies following northeastern city of Harbin's measures to support property developers and their projects.
Top developers Country Garden and Sunac China both rose 2%.
Evergrande's electric vehicles unit jumped over 10% after it vowed to start producing cars next year.