Excitement is high in the Chinese real estate market and even Chinese insurance companies are jumping into the fray.
Most notably, China Life (LFC US, 2628 HK), China’s largest insurance company by assets, is actively looking for architects:
China Life Properties, with registered capital at 254.4 billion yuan, has 2.9 billion yuan of total assets. Besides insurance, its scope of business includes restaurants, building management and real estate agencies.
Despite the regulatory limbo, insurance companies become increasingly involved in the real estate sector since the new insurance law was effective in October 2009. China Life expanded its holdings of Sino-Ocean Land Company Ltd. to 24.08 per cent, becoming the largest shareholder of the property developer in January of this year.
China Life isn’t alone:
Wu Yan, chairman of PICC, one of the largest insurance companies in China, told the media in early March during the annual legislative session that his company will invest in the real estate sector once detailed rules made by the insurance regulator are issued. Informed sources told Caixin that PICC is also preparing for the creation of a real estate property company. In February 2010, China Pacific Insurance and Taikang Life jointly bid for a large land plot in Shanghai, drawing attention to the involvement of insurers in the real property business.
And you thought you owned an insurance company when you bought the stock… this is an example of how most analyst research reports are total BS when it comes to companies like this. Detailed financial models are useless when a company can change its industry exposure on a dime.