The Story Behind ZhongAn’s Blockbuster IPO

Investors are scrambling for a piece of China’s largest online-only insurer – despite its price tag.

Shares of ZhongAn Online Property & Casualty Insurance rose as much as 18% on their Hong Kong debut Thursday, after a hugely popular initial public offering (IPO) that was nearly 400 times oversubscribed.

Despite its short history and a projection of annual losses for this and next year, the final pricing of IPO shares at HK$59.70 ($7.64) each — the upper end of its marketed price range — puts the four-year-old insurer’s valuation at $11 billion. Though it is still a fraction of insurance giants Ping An and China Life’s market valuations, at $144 billion and $109 billion respectively.