PICC, the country's largest non-life insurer, is preparing to
list in Shanghai this year, the company's top management said
yesterday.
"We've just set up a special team to promote the IPO of A
shares," said Zhou Shurui, vice-president of the People's Insurance
Co (Group) of China. "But we haven't decided whether the group will
go public as an entity or if it will just be Hong Kong-listed PICC
Property and Casualty Co Ltd returning to the mainland market."
The share sale's timing depends on the market and other factors,
said Zhou.
"We expect the country's stock market to reach its peak around
the Olympic Games, but PICC won't be prepared to list then," said
Wang Xiaogang, an analyst at Shanghai-based Orient Securities.
The country's largest insurers - China Life, Ping An and China
Pacific Insurance - have all floated on the Shanghai exchange in
the past two years.
As PICC prepares to list at home, it's also speeding up its
equity investment. The group set up an investment company last
year, paving the way for PICC's entry into private equity firms and
other industries.
"We aim to expand our business into other financial sectors
through equity investment," said Sheng Hetai, general manager of
PICC Group's strategic planning department. "We are looking at
merger and acquisition opportunities in banks and fund management
companies, especially city commercial banks and rural
cooperatives."
Last year, PICC paid 1.5 billion yuan for a 15 percent stake in
Datang Mobile Communications Equipment Co, the main developer of
China's 3G mobile technology. It also invested in a 2 billion yuan
energy project.
"But we haven't had any banks contact us about equity investment
in PICC yet," Sheng said.
The banking and insurance regulators signed a memorandum of
understanding on cross-sector investment last Tuesday. Detailed
guidelines are expected soon.
PICC Group's premiums were up 31 percent to 96 billion yuan at
the end of last year, at a growth rate 6 percentage points higher
than the market average. Assets under management also increased 68
percent on a yearly basis.
The group's life insurance arm, PICC Life Insurance Co Ltd, is a
major contributor. The company added another 25 branches in 2007,
taking its provincial outlets to 29. Its premium income also
increased fivefold from 800 million yuan in 2006 to 4.4 billion
yuan in 2007.
"We hope to raise that figure to 10 billion yuan by the end of
2008," said Lan Yadong, assistant president of PICC Life Insurance
Co Ltd.
The group's investment return also hit a record high of 15.2
percent last year, with investment yield totaling 7.86 billion
yuan.
(China Daily January 31, 2008)
