China Life Insurance: 5 Years on NYSE

So it has been five years since China Life Insurance (LFC) IPOed on NYSE, which means I have own this stock for exactly five years, the longest time I have ever owned a stock. That sounds unbelievable to me. Time did pass very quickly :)

It wasn’t a smooth ride however. When I bought the stock on its IPO day (I planed the purchase for quite a long time, getting the fund ready), I had very high hope because, as the dominate player in the insurance market in China, LFC’s potential could be huge because China has 1.3 billion population and Chinese started to realize the importance of having coverage for their health and their properties.

However, despite the potential, the stock barely move for nearly two years since its IPO, hovering around $22 most of the time. The performance of the stock bothered me so much that I sold a big chunk of my holdings. Then the stock took off at the end of 2005, as China stock market started its two-year rally. When LFC reached its all-time high in October last year, I was joking with my wife that we could sell the stock and buy a bigger house (well, at least the downpayment) right away. At that time, LFC was the world’s largest insurer by market value. But I didn’t sell and saw the stock’s downward spiral since then, as the plot below shows.

China Life Insurance (LFC) 5 years

Of course, the general market condition didn’t cooperate since last summer. Despite the poor performance of the stock recently, I have no plan to sell my holding. I am going it ride it out and see what happens :)

On its 5-year anniversary as a listing company on NYSE, I collected some major events (including my events) of China Life Insurance since its IPO if you care.

  • China Life Insurance began trading on NYSE under symbol LFC on December 17, 2003 with an opening price of $23.25. The IPO raised $3.6 billion, the largest ever at that time. I bought 1,000 shares of LFC at $25.16 a piece.
  • LFC started trading on Hong Kong Stock Exchange under symbol 2628.HK.
  • Bought another 200 shares of LFC at $30.41/share on January 6, 2004.
  • Law firms in U.S. filed class action lawsuits against LFC in March 2004, alleging the company failed to disclose certain information in their IPO filings.
  • Sold 700 shares of LFC at $26.21 per share on May 18, 2005 as I was so disappointed the stock barely moved since its IPO.
  • LFC delivered its first dividend at $0.23 per share on August 2, 2006.
  • LFC was suspended on NYSE on November 16, 2006 before the company announced that it took a 20% stake at Guangdong Development Bank, together with Citi, BoA, and RBS.
  • LFC conducted 2:1 stock split on December 26, 2006. The stock closed at $139.15 on December 25, 2006 and was priced at $52.31 at the open on December 26, 2006. After the split, I own 1,333 shares of LFC.
  • LFC won approval to list its stock on domestic market on December 15, 2006 to raise $3.2 billion or 25 billion yuan with its IPO on Shanghai Stock Exchange.
  • LFC closed above $100 a share for the first time on December 14, 2006 and the market value of LFC more than tripled in 2006.
  • LFC distributed its annual dividend of $0.25 per share on August, 6, 2007.
  • LFC IPOed on Shanghai on January 11, 2007 and raised at $3.6 billion. LFC’s Shanghai IPO is the second largest domestic offering back then, only after ICBC.
  • LFC closed at its all-time high of $104.97/share on October 17, 2007 :)
  • LFC’s annual dividend increased to $0.89 a share on July 21, 2008.
  • Law suits against LFC dismissed in New York on September 5, 2008.
  • LFC opened at $37.59 on NYSE on November 18, 2008, its five-year anniversary :(

*Photo from NYSE

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