Insurance News
- China Pacific IPO price seen over 25 yuan
Date: 19-Dec-2007 Sources: (Shenzhen Daily)
CHINA Pacific Insurance, the country's third largest life insurer, is expected to set the price of its domestic initial public offering at more than 25 yuan (US$3.38) per share, an official newspaper reported yesterday.
China Pacific, partly owned by U.S. private equity fund Carlyle, finished its IPO roadshow yesterday and an official announcement of its Shanghai IPO price was expected to be published today, the Shanghai Securities News said.
Most institutional investors, led by domestic fund managers, expected China Pacific's Shanghai IPO price to be set at more than 25 yuan per share, the newspaper reported.
Many investment banks such as China International Capital Corp., a Morgan Stanley China joint venture, estimated that China Pacific's reasonable valuation could be more than 45 yuan by the end of 2008, the paper said.
Some analysts expected China Pacific's Shanghai IPO price may reach 27 yuan as they believed China Pacific's monthly insurance premium growth could exceed the industry average of 50 percent if the firm can improve its operational efficiency after the IPO, the newspaper said.
China Pacific is also expected to launch its Hong Kong IPO soon after its Shanghai IPO, and analysts have expected that the insurer, which is also a major non-life insurance services provider, could raise a total of over US$6 billion through its dual listings.
China Pacific recorded a net profit of 3.823 billion yuan in the first half of 2007, more than triple full-year earnings in 2006 and 2005, according to the prospectus.
The company had a 9.5 percent share of China's life insurance market and 11.6 percent of the country's property insurance market in the first half of this year. (SD-Agencies)
Life insurance accounted for 65 percent of its total premium income and property 35 percent.
China Pacific predicted its net profit would reach 6.446 billion yuan for the full-year 2007, giving it per-share earnings of 0.84 yuan, jumping from 0.23 yuan in 2006 and 0.26 yuan in 2005.
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