China Life's trillion-yuan funds heavily invested in tech stocks, next targeting artificial intelligence and semiconductors | Live coverage of the earnings conference

Hua Xia Times reporter Wu Min reports from Beijing

As the first 2025 annual report from a listed insurance company on the A-share market, China Life has delivered a performance report that has attracted considerable market attention. The company achieved a full-year net profit attributable to shareholders of 154.078 billion yuan, a year-on-year increase of 44.1%; total premiums exceeded 700 billion yuan for the first time, reaching 729.887 billion yuan; total investment income was 387.694 billion yuan, a year-on-year increase of 25.8%, with a total investment yield of 6.09%, marking the “third highest” annual investment performance since the company’s listing in 2007.

Regarding this performance report, the management of China Life attributed the main reason for the profit growth to a significant increase in investment income during the earnings release held on March 26. However, the market is more concerned about where this insurance giant, managing over 7 trillion yuan in investment assets, will direct its asset allocation next after achieving its best investment performance in recent years.

Record High Investment Income

In 2025, China Life achieved total investment income of 387.694 billion yuan, an increase of 79.443 billion yuan compared to 2024; the total investment yield was 6.09%, up 59 basis points from 2024. This investment performance is second only to 6.24% in 2015 and 11.07% in 2007.

Regarding the substantial growth in investment income, Liu Hui, Vice President and Chief Investment Officer of China Life, stated at the earnings release that it was due to three factors: first, a firm commitment to increasing exposure to Chinese assets, with a strategic increase in equity proportion of nearly 5 percentage points in 2025, with equity investment exceeding 1.2 trillion yuan, focusing on investing in technology stocks that represent China’s new productive forces; second, seizing the high interest rate environment and the large-scale issuance of long-term bonds in previous years to increase long-term bond allocations across cycles, currently accumulating over 3 trillion yuan in long-term bonds while also increasing allocations to high-dividend stocks during the interest rate decline; third, capturing structural market opportunities, focusing on growth style in equity investments.

In terms of asset allocation structure, by the end of 2025, the allocation ratio of stocks and funds (excluding money market funds) by China Life rose from 12.18% at the end of 2024 to 16.89%. The proportion of fixed-maturity financial assets stood at 70.51%, predominantly in bonds, time deposits, and debt-type financial products. The scale of investment assets reached 7.4 trillion yuan, growing by 12.3% compared to the end of 2024.

Regarding overseas asset allocation, Liu Hui revealed: “The scale of the company’s overseas asset allocation is relatively small and does not significantly impact the overall assets, but we are closely monitoring the global geopolitical risks brought about by related policies.”

After achieving its best investment performance in recent years, the next investment strategy of China Life has become a focal point for the market. Liu Hui provided clear allocation ideas at the earnings release.

In terms of equity investments, she stated that China Life will continue to promote the entry of medium- and long-term funds into the market and seize market opportunities to increase equity investments. Specifically, the focus will be on two categories of assets: first, technology stocks representing China’s new productive forces, closely following the main line of technological iteration and domestic substitution, looking for investment targets with explosive growth opportunities along the entire industrial chain of artificial intelligence; second, the allocation of high-quality high-dividend stocks, building a diversified dividend portfolio to combat low-dividend strategies against the backdrop of declining interest rates.

In fixed income, Liu Hui introduced that the current Chinese bond market is showing a trend of low volatility and upward central tendency, with the 10-year treasury bond yield running between 1.75% and 1.9% this year, showing a slight rebound from last year’s central yield; the long-short interest rate spread has also widened. “The company will focus on the allocation opportunities brought by rising long-term bond yields while adopting a diversified fixed income strategy to seek cost-effective varieties for investment, including perpetual bonds, relatively good fixed income varieties, and alternative debt plans,” Liu Hui said.

At the earnings release, Liu Hui also elaborated on the company’s approach to equity investment. She stated that since the implementation of the insurance equity investment regulations in 2010, China Life has established the first batch of institutions qualified for equity investments and has adhered to a long-term and stable investment style for fifteen years.

In terms of direct equity investment, China Life focuses on core assets, investing in stable cash flow green “dual carbon” assets. In 2016, it invested 20 billion yuan in Sichuan Gas Public Company, obtaining 6% in cash dividends; in 2018, it allocated 28 billion yuan to State Power Investment Corporation Nuclear Energy, and 3 billion yuan to Huadian New Energy in 2021. Both projects went public in 2025, achieving a valuation doubling, with Huadian New Energy becoming the largest IPO project in the A-share market in 2025.

According to Liu Hui, in the PE fund segment, China Life has invested nearly 20 billion yuan through its health series funds, nurturing 22 listed companies with a total market value exceeding 1 trillion yuan, covering leading enterprises such as Mindray and Qizhi Commerce. In the technology innovation sector, the company issued a technology innovation fund of 5 billion yuan, nurturing AI companies such as Moore Threads and Muxi Shares, and recently launched a 4 billion yuan Yangtze River Delta technology innovation fund, focusing on technology tracks such as artificial intelligence and integrated circuits.

Regarding the direction of equity investments during the “14th Five-Year Plan” period, Liu Hui stated: "The company will focus on the country’s efforts to cultivate and expand emerging industries and proactively lay out future industries, continuing to use diversified tools like merger funds, PE funds, and S funds, with a focus on three major directions: first, artificial intelligence and semiconductors, closely following the main line of technological iteration and domestic substitution; second, big health and biotechnology, focusing on innovative drugs and devices, smart diagnosis and treatment, and chronic disease management; third, green energy and new infrastructure, deeply engaging in the new energy sectors such as wind and nuclear power, and paying attention to investment opportunities in new energy storage and computational collaboration.

Premiums Exceed 700 Billion Yuan

While making efforts on the investment front, China Life’s business side has also achieved breakthroughs. In 2025, the company recorded total premiums of 729.887 billion yuan, crossing the 700 billion yuan threshold for the first time, a year-on-year increase of 8.7%. Among them, renewal premiums accounted for nearly 68% at 495.808 billion yuan.

In terms of channel structure, the individual insurance channel achieved total premiums of 551.790 billion yuan, a year-on-year increase of 4.3%, with new business value rising by 25.5% year-on-year. By the end of 2025, China Life had 587,000 individual insurance sales personnel. The bank insurance channel became a growth highlight, with total premiums of 110.874 billion yuan for the year, a year-on-year increase of 45.5%; new single premiums increased by 95.7%. The company maintained the industry’s leading scale with a total sales force of 638,000.

Regarding channel development, China Life Chairman Cai Xiliang stated at the earnings release that individual insurance is the company’s core channel, contributing 85% of new business value; bank insurance is the company’s strategic development channel. Against the backdrop of low interest rates and growing demand for pensions, the company leverages the long-cycle characteristics of life insurance products to provide more choices in the field of pension finance.

On the reform of the individual insurance channel, Cai Xiliang noted: “In 2025, the company’s ability to enhance its core capabilities increased by 40% year-on-year, and the 13-month retention rate improved by 2.2 percentage points year-on-year, with the age and educational structure of the team improving. In 2026, the individual insurance channel will continue to deepen the reform of the marketing system.”

Regarding profit distribution, the board of directors of China Life has proposed a cash dividend of 6.18 yuan (before tax) for every 10 shares at the end of 2025. Together with the mid-year cash dividend already distributed, the total annual dividend amounts to 8.56 yuan (before tax) per 10 shares, with a total dividend of 24.195 billion yuan, an increase of 31.7% year-on-year. Since its listing, the company has distributed a cumulative dividend of over 245 billion yuan.

In response to the losses in net profit recorded in the third and fourth quarters of 2025, China Life President Li Mingguang stated at the earnings release that the majority of the investment assets and insurance contract liabilities of life insurance companies need to be measured at current market value, and it is a normal phenomenon for net profit and net assets to fluctuate according to market value. The negative profit in the fourth quarter was mainly due to structural adjustments in the capital market, leading to a pullback in some equity funds held by the company in the fourth quarter.

Li Mingguang pointed out that life insurance companies have long-cycle, cross-cycle operational characteristics, and the investment insists on value investment and long-term investment. He suggested analyzing the income statement and balance sheet of life insurance companies over a longer cycle.

As the “14th Five-Year Plan” begins, the management of China Life introduced the key reforms for the future. Li Mingguang stated that in 2026, China Life will advance reforms in five key areas: promoting digital transformation, implementing digital change projects to closely integrate digitalization with company operations, fully empowering product design, precise sales, operational services, and risk control; upgrading operational management models to further improve asset-liability management and transmission mechanisms; promoting coordinated development across all channels, enhancing the professional sales and service capabilities of each channel; deeply advancing customer management and improving the large service system; and promoting investment capacity building to strengthen asset allocation capabilities and investment variety capabilities.

In terms of pension finance and the silver economy, China Life’s assistant president and chief actuary Hou Jin stated that the company will accelerate the development of pension guarantee business, providing full lifecycle pension protection while continuing to deepen the “insurance + health care” ecosystem. Since 2016, the company has participated in over 70 pilot projects for long-term care insurance.