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Product cover image for Evergrande Group: The Largest Bankruptcy in Corporate China

Evergrande Group: The Largest Bankruptcy in Corporate China

Renhui Fu, Yaqi Shi

Product #:W45909
Supplier:Ivey
Discipline:Accounting, Finance
Setting:China, 2023
Details:Case (PDF) • 19 pages • 2025-09-23

Subjects:

Finance and investingAccounting

Industries:

Real estate industry

Geography:

ChinaAsia
Your Price:$9.71

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This case describes the largest bankruptcy in corporate China. The China Evergrande Group (Evergrande), founded in 1996, became a major player in the real estate industry through aggressive, high-leverage strategies. However, it faced a severe financial crisis due to overexpansion, financial fraud, and regulatory tightening implemented by the government. In December 2024, a senior financial analyst at one of Evergrande’s major creditors, was assessing the financial implications in this evolving situation. She scrambled to find a way it could recoup its investments in Evergrande.

Learning Objectives

This case is suitable for graduate and undergraduate students as part of a corporate finance or financial statement analysis course. This case assumes a prior understanding of financial accounting and should not be used as an introduction to a financial accounting course.

After working through the case and assignment questions, students will be able to do the following:
  • Identify the determinants of bankruptcy for a real estate company
  • Understand causes and consequences of financial fraud
  • Perform financial statement analyses
  • Evaluate the advantages and disadvantages that high leverage provides in capturing investment opportunities; growing earnings before interest, taxes, depreciation, and amortization; generating returns; and causing a liquidity crisis when firms face difficulty in operation
  • Evaluate the pros and cons of different types of corporate governance
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Case Study: Evergrande Group: The Largest Bankruptcy in Corporate China (English version) | Ivey Publishing