Understanding the Market | Domestic Insurance Stocks Rise Again, Insurance Capital Equity Investment Accelerates, Insurance Capital's "Long Money" Continues to Enter the Market with Positive Policy Direction
Insurance stocks rose again, with China Life up 4.38%, CPIC up 3.43%, SUNSHINE INS up 3.1%, and NCI up 2.09%. As of the end of May, seven insurance companies have implemented 15 stake increases, approaching the total number of stake increases for the entire year of 2024. Minsheng Securities pointed out that the policy tone is positive, and measures such as reserve requirement ratio cuts and interest rate reductions are expected to boost market sentiment. As important institutional investors, insurance funds continue to enter the market, and the equity investment side will benefit from the long-term value growth of high-quality listed companies
According to the Zhitong Finance APP, domestic insurance stocks have risen again. As of the time of publication, China Life (02628) rose by 4.38% to HKD 18.58; China Pacific Insurance (02601) rose by 3.43% to HKD 28.65; Sunshine Insurance (06963) rose by 3.1% to HKD 3.33; and New China Life Insurance (01336) rose by 2.09% to HKD 39.
In terms of news, according to statistics from the Insurance Association, as of the end of May, seven insurance companies have implemented 15 stake acquisitions, approaching the total number of stake acquisitions for the entire year of 2024. It is reported that there have been three peaks of stake acquisitions in the insurance industry over the past decade, with the first two occurring in 2015 and 2020. Since 2024, insurance funds have entered the third wave of stake acquisitions. In this round of stake acquisitions, the companies being acquired have more significant high dividend characteristics. From an industry distribution perspective, as of the end of May, this year, insurance funds have favored industries such as banking, public utilities, and energy.
Minsheng Securities released a research report stating that since the beginning of the year, policies have been positively oriented. After the State Council Information Office meeting, policies such as reserve requirement ratio cuts and interest rate reductions have gradually been implemented, which is expected to boost market sentiment and promote continuous valuation recovery. As important institutional investors, insurance funds, supported by policies and the objective trend of declining interest rates, are expected to increase stock investments in the secondary market through private equity funds, which may improve the long-term investment portfolio structure and solidify the dividend basis of dividend insurance, potentially becoming true "patient capital" and enhancing asset-liability levels. The firm believes that the continuous entry of "long money" from insurance funds into the market is likely to fully benefit from the long-term value growth of high-quality listed companies
