The Carnage Continues for Mexican Homebuilders Adam Thomson - FT.com
go to original March 27, 2013

Enrique Peña Nieto’s arrival to the presidency on December 1 last year has turned things around for just about everyone, it seems. Investors are showing a voracious appetite for Mexican government bonds and for the country’s stock market, where shares on Tuesday recorded their biggest daily gain in more than a year.

Even Carlos Slim’s América Móvil, which had taken a pounding this month after the centrist Peña Nieto announced a bill to shake up the country’s telecommunications sector, has sprung back into favor: shares in the company have gained more than 13 per cent in the last week or so.

Everyone, it seems, but for Mexico’s leading homebuilders.

Over the last couple of months, shares in the three leading companies have gone through the floor. Urbi Desarrollos Urbanos shares have lost 57.9 per cent since February 5; shares in Desarrolladora Homex have lost 38.8 per cent since February 4; and shares in Corp. Geo have lost 56.3 per cent since the first week of January.

And now even bondholders are jumping ship. Bonds issued by the three homebuilders are trading at or near all time lows while yields have jumped accordingly.

Read the rest at FT.com

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