Technology Growth Sector Gains Attention

From an industry perspective, the technology growth sector has attracted significant interest from insurance capital. Among them, companies in the computer industry received a total of 88 research visits from insurance institutions, ranking first in terms of research frequency. Companies in the electronics and pharmaceutical/biological sectors followed closely, each receiving over 80 research visits from insurance institutions. Industries such as machinery, automotive, and telecommunications also garnered considerable attention from insurance capital.

Defu Technology, a leader in power equipment, specializes in the R&D, production, and sales of electrolytic copper foil, with products mainly including various high-performance lithium battery copper foils and electronic circuit copper foils. The company recently announced plans to acquire 100% equity of Luxembourg Copper Foil for €174 million. During research visits, institutional investors, including insurance capital, showed particular interest in the target company's fundamentals, operational performance, and potential synergies. Defu Technology stated that upon completion of the transaction, its total electrolytic copper foil production capacity would increase from 175,000 tons/year to 191,000 tons/year.

Shijia Photonics, a leader in optical chips, focuses on the optical communication industry, with core businesses covering optical chips and devices, indoor optical cables, and cable materials. During research visits, institutional investors, including insurance capital, paid close attention to the company's acquisition of Fuxi Kema equity, business progress across segments, capacity expansion, and inventory growth.

In terms of stock performance, some of the researched stocks showed significant gains. For instance, Dongxin Semiconductor's stock price surged over 110% in July, during which it received research visits from four insurance institutions. Defu Technology's stock price rose over 70% in July.

According to data from the Insurance Association of China, as of August 2, insurance capital has made 21 stake acquisitions this year, surpassing the total number for all of 2024. The acquired listed companies primarily operate in banking, environmental protection, transportation, and utilities, characterized by low valuations, high dividend yields, and stable payouts.

Additionally, pilot reforms for long-term insurance capital investments are accelerating. Information from the Asset Management Association of China shows that Taibai Zhiyuan No. 1 Private Securities Investment Fund has recently been established and is now operational. This fund is part of the pilot program for long-term insurance capital investment reforms.

The latest Q3 2025 Investment Confidence Index survey released by the Insurance Asset Management Association of China indicates a rebound in equity investment confidence among insurance institutions, rising from 50.12 in Q2 to 56.11 in Q3.

Looking ahead, Yan Zhiyong, Assistant General Manager and Chief Equity Investment Officer of Taikang Asset Management, noted that current market valuations are at reasonably low levels, with policy support expected to continue and liquidity remaining in a weak equilibrium. In terms of investment style, growth and large-cap stocks are likely to outperform. While Hong Kong stocks face short-term pressure, their medium-term allocation value remains significant. Structurally, he recommended focusing on AI computing power, internet, and localization opportunities in the technology growth sector, innovative drugs and medical devices in the pharmaceutical industry, and continuing to allocate to attractive dividend assets in the low-interest-rate environment.