State-owned enterprises are not as homogeneous in China as they are in other parts of Asia, so investors should be extra careful when buying their bonds, Fidelity Worldwide Investment said in a media press briefing today.
Only around 17% of Chinese SOEs receive strong day-to-day government support, with 28% getting medium-to-strong day-to-day support and the remainder low but some levels of support, Fidelity said, citing a recent study of the sector.
Levels of extraordinary support including that of a potential government bailout in the event of default also vary significantly and are difficult to gauge due to a lack of historical evidence, said Sabita Prakash,...
¬ Haymarket Media Limited. All rights reserved.
