Why are the H-shares of Postal Savings Bank of China and China Merchants Bank preferred by venture capital in the New Year?

According to statistics, in the past month, Ping An Group and its subsidiary Ping An Life Insurance have continuously increased their holdings in several H-share banks, with a total investment of at least 5 billion Hong Kong dollars, involving China Construction Bank, Industrial and Commercial Bank of China, Postal Savings Bank of China, Agricultural Bank of China, and China Merchants Bank. It is widely believed in the industry that insurance funds are keen on banking stocks with low valuation and stable dividends, as they seek long-term stable returns and dividends. The latest data from the Hong Kong Stock Exchange shows that Ping An Insurance Life Insurance Co., Ltd. increased its holdings of Postal Savings Bank of China H shares and China Merchants Bank H shares on January 8 and January 10, with an investment of approximately 33 million Hong Kong dollars and 73 million Hong Kong dollars respectively. After the increase, the latest holdings reached approximately 1 billion shares and 230 million shares respectively, with the shareholding percentages exceeding 5%, triggering the disclosure threshold. On January 7, Ping An Insurance purchased 31.678 million shares of Agricultural Bank of China H shares, with an investment of nearly 1.34 billion Hong Kong dollars; after the increase, the latest shareholding percentage exceeded 5%. With the foundation of low P/E ratios, low P/B ratios, and high dividend yields, along with expectations of high dividends, ongoing share buybacks, and cancellations, the banking sector has turned around since last year and become a popular target for investors. According to Wind statistics, the A-share banking sector rose by 46.67% in market value-weighted average in 2024, ranking first among the Shenwan first-class industries. Yang Delong, Chief Economist of Qianhai Kaiyuan Fund, stated that insurance companies increase their holdings of banking stocks mainly due to the undervaluation and high dividend characteristics of these stocks. In addition, the operating conditions of banks, especially large state-owned banks, are relatively stable, which aligns well with the investment philosophy of insurance funds. The investment characteristics of insurance funds require pursuing long-term stable returns, adhering to the concept of value investment and long-term investment, and the characteristics of banking stocks just meet this investment demand of insurance funds. According to predictions by industry professionals, insurance funds will continue to increase allocations to banking stocks in the future. Due to the long-term low interest rate environment in the domestic market and the higher dividend yields of some banking stocks compared to market rates, investing in banking stocks is more attractive than other low-risk assets. It is worth mentioning that many insurance investment officials are optimistic about the investment opportunities in the Hong Kong stock market this year. A large insurance asset management investment officer stated that in terms of valuation, Hong Kong stocks have significant advantages over A-shares in terms of dividends; in terms of funds, quantitative and speculative risks are significantly lower than A-shares; and in terms of industry trends, artificial intelligence and domestic support are both good assets in the Hong Kong stock market sector. Therefore, he believes that there are bigger investment opportunities in Hong Kong stocks. Another major insurance investment officer believes that due to the impact of mutual recognition funds, the Hong Kong Stock Connect, and the loosening of overseas liquidity, Hong Kong stocks still have obvious valuation advantages and good investment opportunities.