Incident 1. The company announced on March 22 that the acquisition of Guohua Life's shares has all been completed, and Guohua Life has become a holding subsidiary of the Company. 2. Announce the capital raising plan for the non-public offering of shares, with a total amount not exceeding 9.5 billion yuan. After deduction of issuance fees, it will be used to acquire 40.75% of the shares of AXA Tianping Property Insurance, increase the capital of Guohua Life, and repay bank loans. Brief review 1. The capital raised is mainly used to acquire shares in AXA Tianping and increase the capital of Guohua Life's current non-public stock offering of no more than 9.5 billion yuan, of which 4,768 billion yuan was used to acquire 14.89%, 10.10%, 8.31% and 7.44% of the shares held by Shanghai Yike, Hainan Huage, Hainan Lu Da, and Shanghai Rixingkang respectively, for a total of 40.75%. In addition to the 9.25% shares held previously, it will hold 50% of Ansheng Tianping's shares, while also increasing the capital of Guohua Life Insurance by 86.34 billion yuan. Bank loans amounted to 346 million yuan. 2. The foreign shareholders of AXA Tianping have strong strength and vigorous development of Internet insurance. AXA Tianping was established by merging Tianping Auto Insurance, the first professional car insurance company in China, with the wholly-owned property insurance subsidiary of AXA, a leading international insurance group, in China. France's AXA Group ranks second in the global insurance industry, is one of the world's leading insurance companies, and has strong shareholders. In 2015, AXA Tianping achieved original premium income of 7.16 billion yuan. It is the largest foreign-owned (joint venture) property insurance company, with a market share of 0.9% (accounting for 41% of the total of 22 foreign-funded property insurance companies). The company aims to become a leading domestic Internet insurance brand. In 2015, premium revenue from direct sales channels accounted for 43% of total premium revenue. 3. As agreed in the “Capital Increase and Expansion Agreement with Conditions”, Guohua Life Insurance's solvency will be greatly increased. As agreed in the “Conditional Capital Increase and Stock Expansion Agreement”, Tianmao Group will use 4,386 billion yuan to increase Guohua Life's capital, and other shareholders will increase Guohua Life's capital in the same proportion according to their shareholding ratio. The total capital increase of 8.6 billion yuan in addition to Guohua Life's previous acquisition of 5 billion yuan in conjunction with other shareholders, the total capital increase of Guohua Life has reached 13.6 billion yuan, which will greatly improve its solvency and ensure future business development. 4. The insurance business will significantly enhance the company's profitability. From 2013 to 2015, Guohua Life Insurance's original premium income was 2.32 billion yuan, 4.13 billion yuan and 23.67 billion yuan respectively, with growth rates of -26.8%, 77.8% and 472.7% over the three years; in 2015, the scale of universal insurance also grew rapidly, about 21.8 billion yuan, an increase of about 55% over the previous year, achieving a two-wheel drive between traditional insurance and universal insurance. The new regulations of the Insurance Regulatory Commission require short and medium life period products to be kept within the limit, and a transition period of up to five years is granted. For Guohua Life, the scale and speed of product development with short and medium life periods will stabilize, and product restructuring will be accelerated. Business development is guaranteed after capital increases. AXA Tianping achieved original premium revenue of 7.16 billion yuan in 2015. As an industrial insurance company, the company's direct sales channel accounts for a high share of premium revenue, costs are better than the industry average, and business quality is good. Future collaborative development of financial insurance and life insurance businesses on the same platform is expected to achieve rapid development and enhance Tianmao Group's profitability. Maintain the company's “increase in holdings” rating. Risk warning: Competition in the auto insurance market has intensified, the capital market has fluctuated greatly, and acquisition integration has fallen short of expectations.