Hot Investment Profile: Great Eastern Holdings, Ltd

SGX Stock Code: G07 / Stock price: SGD22.25

The oldest life insurance company in Singapore and Malaysia, Great Eastern Holdings Limited was one of last week’s gainers on the Singapore Exchange (SGX). Founded in 1908, Singapore-based Great Eastern has been one of Asia’s leading insurance providers for more than a hundred years. It is also one of the most established insurance companies with about 4.7 million policyholders and more than SGD60 billion in assets.

Company Snapshot

Great Eastern has three main business segments:

1. Life Assurance, whose services include life insurance, health and accident insurance, and annuity for businesses
2. General Insurance, where the company issues short-term property and casualty contracts, short-term medical and personal accident contracts
3. Shareholders, which includes fund management, financial advisory and other corporate services

In 2012, Great Eastern went beyond traditional insurance services to become a “Life” company. As such, the company launched its Live Great wellness programme, which aims to help customers live healthier lives through tools, apps, workshops and other activities.

Great Eastern is a subsidiary of OCBC Bank, Singapore’s second-largest group of banks in terms of total assets.

Great Eastern itself has the following major subsidiaries:

• Great Eastern Life Assurance
• Overseas Assurance Corporation, which provides life and general insurance in Singapore
• Lion Global Investors, one of the biggest Southeast Asian private asset management companies for Southeast Asia

Great Eastern’s regional activities include operations in Brunei, Indonesia and Vietnam, maintaining a representative office in Myanmar, and a joint venture in China.

Asia Insurance Review named Great Eastern, Life Insurance Company of the Year at the 2011 and 2013 Asian Insurance Industry Awards.

Standard & Poor’s has also assigned Great Eastern ‘AA-’ ratings for financial strength and counterparty credit since 2010.

Stock Analysis

Bloomberg reports an 8.94% YTD for Great Eastern, with a one-year return of -9.71%.

Great Eastern has a dividend-indicated gross yield of 2.26%, with an earnings per share of SGD1.390.

Latest Developments

• In its financial results for the first quarter of 2016, Great Eastern reported revenues of SGD165.30 million, and net earnings of SGD96.60 million.
• Evergrande, China’s third-biggest developer in terms of sales, acquired 50% of Great Eastern’s Chinese joint venture.
• Great Eastern’s parent company, OCBC, is buying Barclays Plc’s Asian wealth and investment management business for about USD320 million.
• Great Eastern raised SGD83,788 for needy school children under The Straits Times School Pocket Money Fund

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Photo credit: https://www.greateasternlife.com/sg/en/about-us/company-profile/a-trusted-name-in-insurance.html