Cheng Tai Property Insurance Shareholders "Unable to Protect Themselves," Over Half of Equity Stakes in Abnormal Situation

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Text | Xin Tai Editing / Chen Xiaquan

Source / Yan Shu Master Institute

Stable personnel policies bring peace of mind; stable equity solidifies the foundation of the enterprise.

Today, Cheng Tai Property & Casualty Insurance presents a complex picture of leadership chaos and abnormal shareholding structures. Initially funded by seven provincial state-owned enterprises, it later introduced Tsinghua Unigroup as a strategic investor, forming a joint shareholding pattern between state assets and private capital. However, as time passes and circumstances change, this diversified ownership structure has become a heavy burden hindering the company’s development.

Shareholders “Unable to Protect Themselves”

In December 2025, approximately 190 million shares of Cheng Tai Property & Casualty Insurance were listed for transfer on the Beijing Equity Exchange. The transferor was Yunnan Metallurgical Group Co., Ltd. (hereafter “Yunnan Metallurgical”), with a minimum price of 184 million yuan. The information disclosure deadline was January 28, 2026. Ultimately, the transfer was unsuccessful.

Image source: Beijing Equity Exchange

Yunnan Metallurgical, one of the founding shareholders of Cheng Tai Property & Casualty Insurance, initially held a 19% stake. After multiple rounds of capital increases and share expansions, its shareholding was diluted to 3.18%, ranking as the eighth-largest shareholder.

This marks Yunnan Metallurgical’s third attempt at listing for transfer.

Looking back to November 2023 and October 2024, Yunnan Metallurgical twice listed its shares for transfer, with the minimum price dropping from 156 million yuan to 125 million yuan, both ending in failed bids.

Notably, this auction significantly increased the price by 47.2% compared to the previous round. Amid multiple failed attempts, why was there a reverse price adjustment? Industry analysts believe this was not due to a reassessment of the company’s value but more a strategic move by the transferor to fulfill the obligation of preserving and increasing the value of state assets, avoiding the awkward situation of “selling at a discount with no buyers.”

The latest solvency report shows that as of the end of 2025, Cheng Tai Property & Casualty Insurance had 11 shareholders. The largest shareholder is New Tsinghua Unigroup Co., Ltd., holding 33%; Yunnan Kanglv Holding Group Co., Ltd., Kunming Industrial Development Investment Co., Ltd., and Kunming Development Investment Group Co., Ltd. each hold 13.4%, tying for second place.

Image source: Q4 2025 Solvency Report

However, most of Cheng Tai’s shareholders are already “unable to protect themselves.” Among the 11, seven have all or part of their shares pledged or frozen, involving a total share pledge ratio of 56.96%, exceeding half of the company’s total share capital.

Specifically, the second-largest shareholder, Yunnan Kanglv Holding Group, has all its shares pledged; Kunming Industrial Development Investment Co., Ltd. has all its shares pledged or frozen; Kunming Development Investment Group’s 69.25% stake is pledged, with 30.75% frozen; Kunming Gangtong Logistics Group’s 8.71% stake is pledged; and Kunming Transportation Investment Group’s entire shareholding is pledged and frozen.

Other minor shareholders are also affected. For example, the Sino-foreign joint venture Dalian Centennial Mall Co., Ltd. holds 1.68% of shares frozen; Yunnan Yuheng Investment Development Co., Ltd. also has 1.68% pledged and frozen.

The shareholders’ own financing and debt pressures are major reasons behind the abnormal shareholdings. For instance, Yunnan Kanglv Holding Group pledged its insurance company shares to obtain liquidity; Kunming Industrial Development Investment is involved in debt disputes or legal proceedings, leading to judicial freezing of shares, and has also pledged shares for financing. Currently, this shareholder is subject to restrictions, classified as a “restricted person,” with an enforcement amount of up to 1.44 billion yuan. Meanwhile, Dalian Centennial Mall experienced three judicial auctions of its shares in 2025, all unsuccessful, indicating severe asset disposal difficulties and financial distress, leading to inability to repay debts and resulting in freezing.

The large-scale pledge and freezing of shares affect normal company operations and significantly weaken the attractiveness of the shares, discouraging potential investors. Yunnan Metallurgical’s three failed listings serve as a typical example.

Is the Business Operating Legally?

Cheng Tai Property & Casualty Insurance’s operational performance has been “initially rising then falling.” From 2015 to 2022, it achieved eight consecutive years of profit, with net profit increasing from 15 million yuan to 33 million yuan. Although modest, it was progress.

But the turnaround happened suddenly. In 2023, the company shifted from profit to loss, with a net loss of 248 million yuan. In 2024, the loss widened further to 297 million yuan, with operational pressure mounting.

In 2025, signs of recovery appeared. The latest solvency report shows that by the end of 2025, the company’s insurance business revenue reached 2.2 billion yuan, an 8.53% increase; net profit was 200 million yuan, turning losses into profits year-over-year.

Image source: Q4 2025 Solvency Report

However, the underwriting segment still incurred losses, indicating that the core business has not truly recovered. In 2025, the company’s combined ratio was 105.39%, with a combined expense ratio of 38.42% and a combined loss ratio of 66.97%.

It can be inferred that the year’s profit largely depended on investment income.

By the end of 2025, the company’s investment yield and comprehensive investment return were 1.56% and 1.15%, respectively. Although these yields are low, the total assets amounted to 9.603 billion yuan, with net assets of 7.502 billion yuan, meaning investment income barely covered underwriting losses.

But “using investment to offset underwriting” is an unstable profit model; a fundamental overhaul is needed.

The business structure is single, and costs are rigid. In 2025, the company’s auto insurance premiums signed totaled 1.426 billion yuan, accounting for about 62% of total premiums; agency channel premiums reached 1.777 billion yuan, or 76.8% of total, leading to rigid channel costs that compress profit margins and lack autonomous customer acquisition capabilities.

Although Cheng Tai achieved a slim profit in 2025 by “investing to supplement underwriting,” this does not indicate strong investment ability. The latest solvency report shows that the company’s average (comprehensive) investment yield over the past three years was only 0.65%, far below industry averages. Without effective hedging of underwriting losses, the company remains vulnerable to market fluctuations, with poor profit stability.

Adding to the difficulty, penalties are mounting.

In November 2025, Cheng Tai was fined 120,000 yuan by Yunnan regulators for employees fabricating false insurance claims to fraudulently obtain insurance money; in December 2025, Puer branch was fined 220,000 yuan for preparing false financial documents and fabricating intermediary business expenses; in January 2026, Yongcheng branch was fined 120,000 yuan for not properly using insurance terms and rates.

Looking at the long-term pattern, “data falsification” has been a chronic issue. As early as December 2023, Cheng Tai was fined 800,000 yuan for improper use of insurance company funds and submitting false reports; in 2024, its Dali branch was fined 375,000 yuan for preparing false financial documents, fabricating intermediary expenses, and failing to publish new insurance licenses as required.

Clearly, Cheng Tai is mired in internal and external troubles: over half of its shares are abnormal, core underwriting business is loss-making, and penalties are frequent. To break the deadlock, in December 2025, Wang Rui was appointed Party Secretary, bringing a glimmer of hope. However, the ongoing vacancy of the chairman position indicates that the road to turnaround remains challenging.