After the "New National Nine Rules", listed insurance companies have joined the ranks of medium-term cash dividends.
Subsequent Xinhua Insurance (601336. SH, 01336. HK), PICC (601319.SH, 01339. HK) and China Life (601628. SH, 02628. HK) announced on the same day that the interim dividend will be implemented in 2024. In addition, those who have implemented interim dividend for many years before Ping An, China (601318. SH, 02318. HK). As of the end of June, four of the five A-share listed insurance companies had decided to pay dividends in 2024.
Industry analysts said that some listed insurance companies such as Ping An of China had high dividend yields and had always been "big dividend payers" in the capital market. Increasing dividend frequency is not only a response to the policy call, but also can improve investors' sense of gain, reflecting managers' confidence in the future development of the enterprise. It is expected that it will become an industry trend in the future, and the dividend yield of listed insurance companies is expected to further improve.
Listed insurance companies follow up medium-term dividend
In April 2024, the State Council issued Several Opinions on Strengthening Supervision and Risk Prevention to Promote the High Quality Development of the Capital Market (hereinafter referred to as the "New National Ninth Article"), in which strengthening the supervision of cash dividends of listed companies is one of the key points of the "New National Ninth Article", and taking multiple measures to promote the increase of stock interest rate and the promotion of multiple dividends in a year have attracted special attention from the market.
After that, some industries quickly responded to the policy call and increased the medium-term dividend, including the insurance industry.
At the end of May, Xinhua Insurance took the lead in issuing the resolution of the board of directors, saying that according to the reviewed financial report for the first half of 2024, the company will implement the interim dividend distribution in 2024 on the condition that the company has distributable profits for the first half of 2024, with reasonable consideration of the current performance, capital status and risk control index requirements. The proportion of the total dividend in the year to the net profit attributable to the shareholders of the parent company in the half year of 2024 is not more than 30%. This also became the first listed insurance company to announce an increase in medium-term dividends after the New National Ninth Article.
At the end of June, China Life Insurance and PICC announced on the same day that they would distribute cash dividends to all shareholders on the condition that there would be profits available for distribution in the half year of 2024.
In addition, among the five A-share listed insurance companies, Ping An has implemented medium-term dividend for many years. Thus, by the end of June, four of the five A-share listed insurance companies had planned to implement medium-term dividends.
Founder Securities According to the analysis, the medium-term dividend is expected to become the industry trend for the following reasons: First, the medium-term dividend conforms to the national policies and regulatory guidance such as the "New National Nine Rules" and the Guidelines for Cash Dividends of Listed Companies; Second, the medium-term dividend policy is conducive to improving the stability, sustainability and predictability of dividend under the increased volatility of insurance companies' profits; Third, medium-term dividend is conducive to smoothing investors' cash flow and enhancing investors' sense of gain. "The medium-term dividend not only reflects the company's emphasis on shareholder returns, but also shows the management's confidence in the company's short-term operational stability and long-term development certainty." Founder Securities said.
For the only one of the five insurance companies that has not yet issued a dividend "voice" CPIC (601601. SH, 02601. HK), according to the analysis of some insiders, the company may not increase the medium-term dividend temporarily due to the consideration that CPIC Life Insurance is issuing 8 billion yuan of large open-ended capital bonds recently. However, the person also said that, according to the announcement of the listed insurance companies, after the interim dividend, the company will take the distributed interim profit distribution factors into account when considering the annual dividend. Therefore, when measuring whether insurance companies have not only increased the dividend frequency but also "real gold and silver" increase the dividend amount, it is also necessary to take the whole year as a unit for overall consideration.
The dividend of listed insurance companies continued to increase
Since there was no increase in medium-term dividends, listed insurance companies have also been classified as "big money" dividends by the market. Statistics show that in 2023, the proposed cash dividends of the five listed insurance companies will be up to 75.5 billion yuan, accounting for 45.6% of the total net profits attributable to the parent company.
According to the data of the Association of Listed Companies, in 2023, 3859 listed companies will release annual, quarterly and special cash dividend plans, and the average dividend ratio of dividend companies will be 36.91%. On the whole, the dividend level of listed insurance companies is far higher than the average level of A-share listed companies.
From the dividend data of several listed insurance companies, the overall situation also shows a continuous improvement.
Among them, the total dividends of Ping An, which had implemented medium-term dividends, have increased for 12 consecutive years, with a compound growth rate of 25%. From the dividend level of the five A-share listed insurance companies in 2023 according to the statistics of China Business News, based on the closing price on June 28, the current dividend rate of Ping An is 5.88%, and the dividend rate in 2023 will exceed 50%.
(Data source: First Finance sorted out according to public information) In addition, China Taibao and China Life also said that since the listing, the cumulative dividend has exceeded 100 billion yuan, including 108.891 billion yuan from China Taibao and 190 billion yuan from China Life.
From the perspective of dividend yield and dividend yield, the current dividend yield of CPIC is 3.66%, and the dividend yield of China Life Insurance is 58%, both of which are good dividend performance in the A-share market.
In addition, the dividend rate of PICC and Xinhua Insurance also reached 30%.
Huafu Securities said that in addition to the A-share market, the dividend yield of domestic insurance companies in the H-share market was also good. The dividend yield of H shares of China Life, Ping An, CPIC, Xinhua Insurance and China Property&Casualty Insurance is about 4.3%, 7.5%, 5.9%, 6.3% and 5.5% respectively. Now, the increase in dividend frequency further sends a positive signal to the market, and it is expected that the dividend yield of insurance companies is expected to further increase in the future.
Massive information, accurate interpretation, all in Sina Finance APP
Editor in charge: Zhang Wen
