Vanke rises nearly 50% as reports indicate that the Shenzhen municipal government is planning an RMB 80 billion rescue plan

UBS published a report stating that, according to "Octus," the Shenzhen municipal government is planning a rescue scheme worth approximately RMB 80 billion for Vanke (02202.HK), which includes a placement of Vanke shares worth RMB 20 billion, aimed at avoiding its default. If the news is true, it would be a positive surprise, and the scale of the funds should be sufficient to cover all of Vanke's outstanding public market bonds, estimated by the bank to be around RMB 26.9 billion.

Vanke (02202.HK) opened up 0.52% today, reaching a high of HKD 4.14. It is currently reported at HKD 4.02, up 4.96%, with a trading volume of 48.8666 million shares, involving a capital of HKD 198 million.

UBS stated that since the publication of the "Qiushi" article on January 1 this year, policy support measures have increased, such as the People's Bank of China / Ministry of Finance's policy support, as well as Shanghai's inventory purchases in the second-hand housing market. Although these measures currently seem to have limited effects, they indicate that the government's policy stance has shifted to be more supportive. Secondly, this will have a more positive spillover effect on Longfor Group (00960.HK) and Seazen (01030.HK), as both companies still rely on commercial property operating loans to repay maturing bonds, which depends on banks' attitudes towards the industry. Thirdly, if the spot market deteriorates again after the Lunar New Year, the bank may see more supportive policies for the industry. Key indicators to watch include the rental price index in first-tier cities, as this index can reflect the underlying demand situation without being distorted by policies and sentiment. The latest data shows that the rental price index in first-tier cities is still recording a decline in January 2026, but the year-on-year decline is narrowing