Shinsun Holdings (Group) Co., Ltd. (Initial Issuer Report)

The Issuer Rating reflects Shinsun Holdings (Group) Co., Ltd.’s (“Shinsun” or “the company”) sizable contracted sales scale, average profitability and regional market franchise. The rating also considers Shinsun’s established market position in Zhejiang province and its capability to grow from its home base to the Pan-Yangtze River Delta (Pan-YRD) region and other selective high growth potential cities. However, Shinsun’s rating is constrained by its high financial leverage, the geographical concentration with significant land bank exposure in low-tier cities, and reliance on non-traditional bank financings.

The Stable Outlook reflects our expectation that Shinsun will maintain its market position in Zhejiang province with a moderate expansion pace, driven by its sizable contracted sales scale and prudent land acquisition approach. Also, we expect Shinsun to reduce its reliance on trust financing and improve its financial leverage in the next 12-18 months.