China Post Life Insurance has increased its stake in Sichuan Road & Bridge Group Co., Ltd. (600039.SH), marking its fourth stake increase this year, as insurance capital accelerates its entry into the market.
On the evening of December 18, Sichuan Road & Bridge announced that China Post Life Insurance had accumulated a 5.00% stake in the company, reaching the regulatory disclosure threshold. This marks China Post Life Insurance’s fourth stake increase this year, following similar moves in Eastern Air Logistics (601156.SH), Green Eco-Manufacture (01330.HK), and China Railway Signal & Communication (03969.HK), covering high-quality A-share and H-share targets.
China Post Life Insurance’s frequent stake increases reflect a broader trend in 2025, with insurance capital becoming increasingly active in equity investments. As of December 19, insurance capital has executed 39 stake increases this year, the highest since 2016 and second only to the 62 recorded in 2015. Additionally, recent regulatory adjustments lowering risk factors for long-term equity holdings are expected to expand insurance capital’s investment scope.
Long Ge, Deputy Director of the Innovation and Risk Management Research Center at the University of International Business and Economics, analyzed that three key factors are driving this trend: regulatory optimization, declining returns on fixed-income assets amid an "asset shortage," and historically low market valuations—particularly for high-dividend, stable blue-chip stocks. These factors are shifting insurance capital’s role from passive financial investors to active strategic allocators.
**China Post Life Insurance’s Strategic Move** China Post Life Insurance’s stake increase in Sichuan Road & Bridge followed months of gradual accumulation. Since March 2025, the insurer has steadily increased its holdings via block trades and secondary market purchases, culminating in a final purchase on December 17 that pushed its stake to 5%.
The insurer stated that the move aligns with its long-term investment strategy and commitment to supporting the company’s sustainable growth. Sichuan Road & Bridge’s high-dividend policy likely played a key role in attracting China Post Life Insurance. The company’s three-year shareholder return plan (2025–2027) promises cash dividends of at least 60% of annual net profits under certain conditions. In the first three quarters of 2025, Sichuan Road & Bridge reported a net profit of 5.3 billion yuan, up 11.04% year-on-year, with Q3 alone surging 59.72% to 2.52 billion yuan.
Notably, the stake increase did not disrupt Sichuan Road & Bridge’s ownership structure, as Shudao Investment Group remains the controlling shareholder. Analysts highlight that such non-controlling, financially driven stake increases are now the norm for insurance capital, benefiting both listed companies (through stable funding and governance expertise) and capital markets (by enhancing liquidity and promoting value investing).
**Broader Insurance Capital Activity** China Post Life Insurance’s latest move is part of a wider surge in insurance capital activity. Other notable stake increases include Taikang Life Insurance’s investment in Henlius Biotech (02696.HK) and Rui Zhong Life Insurance’s stake in Tsingtao Brewery (00168.HK).
The trend spans industry giants like Ping An Life Insurance and niche players like Hong Kang Life Insurance, with targets concentrated in high-dividend, low-volatility sectors such as banking, utilities, and transportation. H-shares have gained prominence, exemplified by Ping An Life’s repeated stake increases in China Merchants Bank (18.02% stake), Postal Savings Bank, and Agricultural Bank.
Market and policy drivers underpin this trend. Declining risk-free yields have made high-dividend equities essential for meeting liability costs. For instance, China Merchants Bank H-shares, which Ping An Life first invested in on January 10, have risen nearly 40% year-to-date while maintaining a 35.32% dividend payout ratio.
Regulatory support has further fueled the momentum. Recent adjustments to risk factors for long-held equities (e.g., CSI 300 and low-volatility dividend stocks) are estimated to free up 29 billion yuan in capital, potentially channeling 96.6 billion yuan into equities—a tailwind for sustained market growth.
Professor Zhu Junsheng, a postdoctoral fellow in applied economics at Peking University, noted that these policy changes encourage insurers to adopt longer investment horizons, bolstering market stability and supporting strategic industries.
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