Ping An Insurance, the mainland's second-largest insurer, may raise HK$33 billion in an initial public offering in Shanghai to support business growth. Shenzhen-based Ping An on Tuesday said its board approved a plan to sell up to 1.15 billion A shares, or 15.7 per cent of its enlarged share capital, before listing on the Shanghai stock exchange. Based on the HK$28.60 closing price of Ping An's Hong Kong-traded H shares yesterday, the offering could fetch HK$32.89 billion. The share sale still needs approval of Ping An's shareholders at a meeting scheduled for November 13 as well as regulatory approval. Investment bankers earlier expected Ping An's A-share sale to take place in the first half next year at the earliest, with possible regulatory delays. The sale will dilute the interest of existing shareholders, including its 19.9 per cent stakeholder HSBC Holdings. The combined holdings of Ping An's H-share owners will fall 6.5 percentage points to 34.8 per cent after the deal. Ping An said it intends to use the proceeds to replenish its capital. 'The A-share issue will establish a new financing platform for the company and broaden the company's access to different securities markets,' it said yesterday. The fund raising will help the insurer, which also runs trust, securities and asset management businesses, to expand its nascent banking platform after it agreed last month to buy 89.24 per cent of city lender Shenzhen Commercial Bank for 4.9 billion yuan. At the end of last year, Ping An's life and non-life insurance divisions had 5.13 billion yuan of excess solvency margin, an industry measure of capital adequacy, over the minimum regulatory requirement. The solvency margin ratio, the level of the actual solvency margin to the regulatory floor, was 140.7 per cent for the dominant life insurance business and 153.4 per cent for its smaller property and casualty insurance arm. China Life Insurance, the mainland's largest life insurer, reported a stronger ratio of 273 per cent, which translated into surplus solvency margin of 37.78 billion yuan. However, the solvency margins underestimated Ping An's financial strength, as 27.05 billion yuan of cash and liquid investments that could be easily converted into cash is carried on the group balance sheet instead, analysts said. Ping An's Hong Kong-listed H shares rose 2.88 per cent yesterday, having doubled in price this year.