Excessive leverage is not a problem as long as China's No. 4 property developer manages debt payments and credit markets remain liquid, but analysts say it has a small margin of error if markets dry up or lose momentum or if it runs into liquidity issues.
"Evergrande needs to rely on short-term loans such as bank and trust lending to refinance when the short-term debt matures. This is risky capital management because banks loosen and tighten lending from time to time and it's unpredictable," said Moody's Investors Service analyst Franco Leung.
Evergrande declined to comment for this article on its strategy for managing its debt.
It began issuing perpetuals in 2013, doubling the amount to 52.9 billion yuan ($8.5 billion) as of end-December, equivalent to nearly half of its equity, corporate filings show. It has the highest value of perpetual use among China's 10 biggest developers by sales, according to a Reuters review of the companies' 2014 balance sheets.
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Evergrande executives have previously said it has issued perpetuals to finance projects. Asked whether it would issue more this year, Chief Financial Officer Tse Wai Wah told a March 30 earnings briefing: "It depends on market conditions... and market reaction," he said.
An economic slowdown and a raft of cooling measures have focused investor attention on the high levels of debt that developers took on to build projects that were not sold. China's property sales in the first two months of 2015 dropped the most in three years amid a housing supply glut and slower property investment.
Smaller homebuilder Kaisa Group Holdings is negotiating with bondholders on restructuring $2.5 billion in offshore debt. Failed talks may mean it risks becoming the first Chinese developer to default on offshore debt.
In Evergrande's 2014 earnings report, published on March 30, its net debt-to-equity ratio was 85.9 percent. If perpetuals were classified as debt, that figure jumps to 292 percent, Barclays said in a note published a day later.
CFO Tse told the earnings briefing that shrinking debt was a priority for 2015. He set a mid-to-long term target for a net debt-to-equity ratio of 70 percent and put a moratorium on bond issues for the year.
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Among developers, Evergrande has been particularly hard hit with most of its projects in less developed cities, where home prices have had some of the biggest drops. It has also borrowed heavily to diversify into food, energy and sports: it finances the Guangzhou Evergrande Taobao soccer club along with e-commerce giant Alibaba Group Holdings.
Evergrande reported gross debt rose 43 percent to around 156 billion yuan ($25.2 billion) at end-2014, and concerns about its leverage have led to speculative-grade ratings from Moody's and Fitch.
Independent financial analysts CreditSights, which classifies perpetuals as debt, says Evergrande's 2014 debt was 11.7 times earnings before interest, taxes, depreciation and amortization (EBITDA), meaning it would take 11.7 years to repay based on its current cashflow.
That ratio is 50 percent higher than the sector average, according to Thomson Reuters data.
Evergrande has also increased fair value gains on investment properties, with the largest single-year gain - 9.4 billion yuan - recorded last year. The gains are based on a unbiased estimate of an asset's potential market price, and help boost a company's equity.
Tse told Reuters after the earnings briefing the majority of the fair value adjustments were on shops and car parks and the revaluations were not inflated.