How CAQ Holdings’ RMB 6M Loan Could Transform Its Industrial Property Future

Debt Restructure Eases Immediate Pressure

CAQ Holdings Limited (ASX: CAQ) has announced a significant adjustment to its debt repayment schedule, easing the immediate financial burden on the company. The repayment originally due in May 2025 was substantially reduced from RMB4.36 million (approximately AUD 930,000) to RMB751,000 (AUD 160,000), an amount which has already been settled. This restructuring extends the remaining repayments over the next year, with scheduled payments in November and December 2025, and a final tranche due in May 2026.

The amended terms maintain a fixed interest rate of 6.5% and notably do not introduce any new covenants, guarantees, or fees, suggesting a cooperative stance from the lender, Bank of Hian Co Ltd. This flexibility provides CAQ with breathing room as it focuses on operational improvements.

New Loan Facility Supports Operational Growth

Complementing the debt restructure, CAQ’s wholly owned subsidiary, Haikou Peace Base Industry Development Co Ltd, has secured a new RMB 6 million (AUD 1.6 million) drawdown loan facility from Hainan Baina Investment Co. Ltd. This two-year loan carries a fixed interest rate of 6% per annum and is secured against Warehouse B, a sizeable asset within the CAQ Industrial Complex in Hainan Province.

This fresh capital injection is intended to underpin the company’s ongoing operational requirements as it targets higher occupancy rates within its industrial property portfolio. The ability to draw down funds as needed offers CAQ flexibility to manage cash flow and invest strategically in its assets.

Operational Cash Flow and Strategic Outlook

CAQ reports maintaining a positive operating cash flow, a critical factor that supports both its debt servicing obligations and operational expenditures. The combination of restructured debt and new financing facilities positions the company to navigate the near-term financial landscape with greater confidence.

While the announcement does not detail occupancy rate targets or potential risks related to market conditions in Hainan, the strategic use of warehouse collateral and the absence of new restrictive loan covenants suggest a pragmatic approach to balancing growth ambitions with financial prudence.

Investors will be watching closely to see how CAQ leverages this financial flexibility to drive occupancy improvements and whether the company can sustain its positive cash flow trajectory amid evolving market dynamics.