Zhong Guo Zheng Quan Bao·2025-09-11 04:58Core Viewpoint - China Pacific Insurance (601601) plans to issue zero-coupon convertible bonds totaling HKD 15.556 billion, maturing in 2030, to secure low-cost funding for business development and capital structure optimization [1][4]. Group 1: Bond Issuance Details - The initial conversion price is set at HKD 39.04 per H-share, representing a premium of approximately 21.24% over the closing price of HKD 32.20 on September 10 [4]. - If fully converted at the initial conversion price, the bonds could convert into approximately 398.46 million shares, accounting for about 14.36% of the existing H-shares and 4.14% of the total issued share capital [4]. - The net proceeds from the bond issuance will be used to support the insurance core business, implement three strategic initiatives ("Big Health", "AI+", and internationalization), and supplement working capital [1][4]. Group 2: Industry Context - The issuance of zero-coupon convertible bonds is becoming a trend among insurance companies, as seen with China Ping An's announcement to issue HKD 11.765 billion in similar bonds [5]. - Industry experts highlight that zero-coupon bonds have lower financing costs and provide flexibility in terms of debt and equity characteristics, which is beneficial for enhancing sustainable profitability and risk resilience [5]. - Convertible bonds are particularly suited for insurance companies' capital replenishment needs due to their lower financing costs, ability to optimize capital structure, and mitigation of short-term shareholder dilution effects [5].