This article comes from WeChat public account: China Economic Weekly (ID: ChinaEconomicWeekly) , author: Xie Wei
Compared with last year, the listing of venture capital has increased significantly this year.
On February 28, China Pacific Insurance (Group) Co., Ltd. (Hereinafter referred to as “China CPIC”) announced a placard announcement that China CPIC and its holding subsidiaries have recently purchased Ganfeng Lithium through the Hong Kong Stock Connect H shares of 2,450,200 shares, involving funds of about 75.35 million Hong Kong dollars, triggered a line of plaques.
This is the “5th move” in venture capital since 2020.
On the previous February 25, Pacific Life Insurance Co., Ltd., a subsidiary of CPIC, (hereinafter “CPIC Life”) The announcement said that the company had completed the listing of Jinjiang Capital on February 19. Earlier on February 24, China Life announced that from February 17 to 19, it will increase its H-shares in Agricultural Bank for three consecutive days and trigger a line of plaques.
Since the “tide of licensing” of insurance capital in 2015, the raising of insurance capital has always attracted market attention. However, today’s venture capital branding is very different from the past in terms of background, subject and logic. Regulators are also guiding insurance capital to increase investment in equity assets, and have repeatedly stated that they encourage insurance capital to enter the market. In the opinion of many in the industry, the signing of insurance funds during the year is expected to continue.
See also the risk capital placard
Specifically, which stocks were targeted by the five bids?
China Pacific Insurance and its holding subsidiaries listed as Ganfeng Lithium
On February 28, CPIC announced on the official website of the China Insurance Association. On February 24, CPIC and its CPIC property insurance, CPIC life insurance, CPIC health insurance, and Anxin agricultural insurance purchased through the Hong Kong Stock Connect. Ganfeng Lithium Industry Co., Ltd. has 2,450,200 H shares, which cost about 75.35 million Hong Kong dollars.
Before the listing, China Pacific Insurance and its holding subsidiaries held a total of 7.172 million H-shares in Ganfeng Lithium, accounting for 3.95% of the H-shares issued by Ganfeng Lithium. After the listing, CPIC and its holding subsidiaries held a total of 10.322 million H shares of Ganfeng Lithium Industry, accounting for 5.16% of the H shares of Ganfeng Lithium Industry.
Public information shows that Ganfeng Lithium was established in 2000 and is mainly engaged in the production of lithium compounds and metallic lithium, providing more than 40 lithium compounds and metallic lithium products. The business covers all important links in the value chain such as upstream lithium extraction, midstream lithium compounds and lithium metal processing, and downstream lithium battery production and recycling. Ganfeng Lithium was listed on the Shenzhen Stock Exchange in 2010 and was listed on the Hong Kong Stock Exchange in 2018.
CPIC Life Insurance Brand Jinjiang Capital
On February 25, CPIC Life Insurance announced on the official website of the China Insurance Association that the company has completed Jinshang Capital’s (2006.HK) < / span>. The announcement stated that CPIC Life Trustee Pacific Asset Management Co., Ltd. (hereinafter referred to as “CPIC Asset Management Company”) directly through the QDII account managed Buying shares of Jin Jiang Capital in the Hong Kong market.
The announcement shows that before the plaque, CPIC Life Insurance held 69.494 million shares of Jinjiang Capital; after the plaque, CPIC Life held 69.786 million shares of Jinjiang Capital, accounting for approximately 5.015% of its Hong Kong outstanding shares. Based on the closing price of Jinjiang Capital on February 19, 2020 and the exchange rate of Hong Kong dollar to RMB 0.9 as the basis, the book balance of CPIC Life holdings of Jinjiang Capital shares was approximately 89 million yuan.
Data shows that Shanghai Jinjiang Capital Co., Ltd. is limitedThe company (hereinafter referred to as “Jinjiang Capital”) is mainly engaged in hotel operations, management and franchising, restaurant operations, passenger logistics and travel agencies. Jinjiang Capital was successfully listed on the main board of Hong Kong in December 2006. Its hotel brands include J.Hotel, Jinjiang, Jinjiang Metropolis, Jinjiang Star, and so on.
China Life Insurance Brand Agricultural Bank
On February 24, the official website of China Insurance Industry Association disclosed that China Life Insurance Co., Ltd. (hereinafter referred to as “China Life”) Announcement of H-shares of Agricultural Bank of China. The announcement shows that starting from February 17, China Life bought H-shares of Agricultural Bank from the Hong Kong secondary market through the Shanghai Stock Connect for three consecutive days: it increased its holdings by 6.2 million shares on February 17, and increased its holdings by 3,000 on February 18. 10,000 shares, an increase of 45 million shares on February 19th, and finally held 1.537 billion H shares of Agricultural Bank, accounting for 5.018%, reaching the red line of licensing.
As of February 19, China Life Group as a whole (including China Life Group and China Life) Totally held 16.128.7 million H shares of Agricultural Bank of China Shares, accounting for approximately 5.2470% of the H shares of the listed company. China Life holds 153,751,100 H-shares in Agricultural Bank, accounting for approximately 5.018% of the H-share capital of the listed company.
Huatai Assets listed Guochuang High-tech
On January 13, Huatai Asset Management Co., Ltd., a subsidiary of Huatai Insurance, (referred to as “Huatai Assets”) on the official website of China Insurance Industry Association A placard announcement was issued. The announcement shows that, on January 9, Huatai Assets issued and managed the “Huatai Assets-Chuangying Series Special Product (Phase 1) ” account passed According to the agreement transfer method, from the transferor Guochuang Hi-Tech Industrial Group Co., Ltd., 73.3 million non-restricted tradable shares publicly issued by Guochuang High-tech were transferred from the transferor Guochuang Hi-Tech Industrial Group Co., Ltd. for a total of 7.9993%.
According to public information, Guochuang High-tech is an enterprise in the field of highway new materials for the transportation industry, integrating research, development, production, sales and engineering construction of modified asphalt high-grade road-related materials and equipment. However, the company’s industry is the real estate industry. In March 2010, Guochuang High-tech was listed on the SME board.
Tai Ping Life holds Joy City
On January 3, Taiping Life Insurance Co., Ltd. (hereinafter referred to as “Taiping Life”) announced on the official website of the China Insurance Industry Association that: Taiping Life Insurance has been assigned a share price of Joy City Holdings Group Co., Ltd. (hereinafter referred to as “Joy City”) 283 million shares, After its fixed increase of 6.61% of the total share capital, the corresponding investment amount is about 1.907 billion yuan.
Before that, Taiping Life Insurance did not directly hold Joy City shares, but its acting person Taiping Assets had three asset management product accounts that all held a small share of Joy City, and the two held a total of Joy City 6.62173% Of shares.
Compared with last year, the pace of insurance capital entering the market has accelerated significantly this year.
According to the data disclosed by the official website of the China Insurance Industry Association, in 2019, a total of 9 listed companies were listed by the insurance company. China Pacific Insurance; China Ping An Department successively listed Huaxia Happiness and China Jinmao; China Pacific Insurance Department listed Shanghai Lingang.
It is not difficult to find that the insurance companies that bought and bought last year were all large insurance companies such as China Life, Ping An and CPIC, and this trend has continued since the beginning of this year. In terms of the type of company being listed, insurance capital prefers stocks in industries such as real estate and non-bank finance. Among them, the real estate industry is very popular, such as Huaxia Happiness, China Jinmao, Shanghai Lingang, Joy City and Guochuang High-tech are real estate stocks.
Insurance equity investment last year increased by 26.8% year-on-year
Today, insurance funds have become the second largest institutional investor in A shares after public funds, and an important indicator of investor concern. Data show that as of the third quarter of 2019, the value of insurance stock holdings in the A stock market has reached 1.33 trillion yuan, accounting for 2.99% of the total market value of A shares in circulation.
AccordingThe China Banking and Insurance Regulatory Commission recently released the 2019 insurance industry operation table. Last year, China’s insurance industry premium income exceeded the 4 trillion yuan mark. From the perspective of insurance capital investment, the balance of capital utilization last year was 18,527.1 billion yuan, a year-on-year increase of 12.9%. From the perspective of investment structure, bank deposits amounted to 2,522.7 billion yuan, and the balance accounted for 13.6%; bonds amounted to 643.2 billion yuan, and the balance accounted for 34.6%; stock and securities investment funds were 2,436.5 billion yuan, and the balance accounted for 13.2%. From the perspective of the balance ratio, the bank deposit ratio of insurance funds in 2019 decreased by 1.25 percentage points compared with 2018, the proportion of bonds was basically flat, and the proportion of stocks and securities investment funds increased by 1.49 percentage points.
However, it seems that insurers’ A-share allocation preferences have not changed significantly.
Wanlian Securities research report shows that from the third quarter of 2019 data, insurance fund A-share positions are still mainly concentrated in finance and real estate. The median PE of positions held by insurance funds at the end of the third quarter of 2019 was 21.64. Excluding China Life Group’s shareholding in China Life and Ping An’s shareholding in Ping An Bank, the top 20 heavy storage stocks of insurance funds include Gemdale Group, Financial Street, CSG A, etc. based on the shareholding ratio. From the perspective of heavy storage stocks, insurance funds prefer stocks with good liquidity and relatively stable performance.
Insurance capital will welcome the favorable policies, and the wave of licensing will continue this year.
In recent years, policies have been continuously introduced to guide long-term funds, including insurance funds, into the capital market.
On January 3, the “Guide Opinions of the China Banking and Insurance Regulatory Commission on Promoting the High-Quality Development of the Banking and Insurance Industry” issued by the China Banking and Insurance Regulatory Commission proposed that the direct financing functions of wealth management, insurance, trust and other products should be effectively used to cultivate value investment And long-term investment ideas to improve the capital market investor structure. Vigorously develop corporate annuity, occupational annuity, various health and endowment insurance businesses, and promote the effective conversion of household savings into long-term capital market capital through multiple channels.
Currently, insurance funds use related regulatory indicators to collectively refer to stocks and equity as equity assets, and the maximum investment ratio is 30%. Since last year, raising the regulatory ratio of equity assets in insurance companies has been on the agenda.
On February 1, Cao Yu, vice chairman of the China Banking Regulatory Commission, responded to a reporter ’s question on financial support for epidemic prevention and control and financial market stability. Based on its existing 30% ceiling, the investment proportion of equity assets should be appropriately increased.
A few days ago, China Insurance Asset Management Association led groupThe survey results of the “Hundred Views” questionnaire of the organization’s insurance asset management industry show that when asked “what kind of assets are you most optimistic about in the next quarter”, equity assets have become the asset class that most respondents are optimistic about. Among them, 29% of the respondents are optimistic about A shares, and 19% of the respondents are optimistic about H shares.
Many in the industry believe that the tide of insurance capital is expected to continue during the year.
A few days ago, Chen Dexian, chief investment officer of Ping An of China, said in an interview with the media, “This year our view is that compared with the price level of bonds, the relative attractiveness of stocks is greater. From a strategic point of view, we still insist on long-term investment, Value investment, counter-cyclical operations, centralized holdings, preference for large dividends and low valuation of large-cap stocks. “
Tianfeng Securities said that there are several major trends in the use of insurance capital in 2020. The first is to increase the allocation of high-yield stocks (dividend rate is higher than 4%) span> to earn stable dividends; the second is to list high-quality listed companies as long-term equity investments (equity accounting) and build business synergy The third is to make use of the long-term and stable advantages of insurance capital, add high-quality long-term debt or other long-term fixed income assets, and reduce the duration gap of assets and liabilities.
Wanlian Securities believes that there is a high probability that insurance funds will provide incremental funds for A shares. On the one hand, the CBRC will appropriately adjust the upper limit of the company’s equity investment in the future, and the threshold for insurance funds to invest in the stock market is expected to further expand. On the other hand, even if the proportion of stocks and securities investment funds in the balance of insurance fund utilization remains relatively stable, if the insurance fund utilization balance is conservatively estimated to increase by 2 trillion yuan annually, it will also bring A-share growth of 200 billion yuan annually. Amount of funds.
This article comes from WeChat public account: China Economic Weekly (ID: ChinaEconomicWeekly) , author: Xie Wei