Temasek puts weight behind Mainland financial equities

18 July 2013   Category: News, China, Singapore   By Hui Ching-hoo

Singapore sovereign wealth fund Temasek Holdings has become increasingly focused on Mainland insurance and securities equities in Hong Kong amid a correction on China’s A-share market. 
According to figures from Hong Kong Exchange and Clearing (HKEx), Temasek purchased 2.86 million shares in China Pacific Insurance Group (CPIG) for HK$73.98 million (US$9.48 million) on July 11, taking its holding in the insurance giant from 4.93% to 5.03%.
The move came three days after the fund purchased 708,500 shares in CITIC Securities for HK$9.06 million, on July 9. That, in turn, came on the heels of two rounds of Industrial and Commercial Bank of China (ICBC) purchases, of 126 million shares and 280 million shares each, for an average price of HK$4.6 and HK$5.5 per share, respectively, on June 26 and June 21.
Hit by a downtick on the A-share market, fuelled by credit woes among Mainland lenders, the prices of CPIG’ and CITIC Securities’ H-shares have both tumbled more than 10% since early May. 
The purchases suggest that Temasek Holdings is positive on a recovery of the Mainland stock market.  
Temasek Group realised a net profit of S$11 billion (US$8.69 billion) in the previous financial year, ending March 31, 2013. Over the past decade, the group’s portfolio has grown from a trough of S$61 billion in March 2003, to a record $215 billion in March of this year.