Fosun Group

Chinese conglomerate Fosun to invest 100 billion yuan in AI, biotech and fintech over next decade

Company reports net profit of 13.16 billion yuan for 2017

PUBLISHED : Wednesday, 28 March, 2018, 7:35pm
UPDATED : Wednesday, 28 March, 2018, 11:02pm

Chinese conglomerate Fosun International is looking to invest in areas such as biotechnology, financial technology and artificial intelligence, according to its chairman, Guo Guangchang. This investment will amount to 20 billion yuan (US$3.2 billion) over the next three years, and 100 billion yuan over the next decade, according to Wang Qunbin, the company’s chief executive.

The company said it would not be affected by curbs on outbound investment imposed by Beijing.

“Our investments are compliant with Chinese laws, and they are complaint with the laws of the countries we are investing in,” said Guo.

Fosun buying US$40m majority stake, and will launch full takeover, of Austrian luxury textiles firm Wolford

The company will focus on India and Africa, he said, as well as on Portuguese-speaking countries.

Fosun reported a net profit of 13.16 billion yuan for 2017, a 28.2 per cent increase over 2016. The gain was led mainly by contributions from the health, insurance and finance segments of the company. Revenue for the period increased by 19 per cent and stood at 88.03 billion yuan.

Fosun’s core business operations are divided roughly into three categories: happiness, wealth and health. The wealth segment contributed most of its profit in 2017, at 11.3 billion yuan, followed by health at 1.4 billion yuan; the profit generated by the happiness segment stood at 498 million yuan.

Our investments are compliant with Chinese laws, and they are complaint with the laws of the countries we are investing in
Guo Guangchang, chairman, Fosun International

“The net gearing ratio of the company has been dropping in the recent five-year period, so investors feel safe about betting on the company,” said Robin Qiao, a fund manager based in Hangzhou.

Fosun’s current net gearing ratio stands at 49.7 per cent, compared with 86 per cent in 2013. Its net debt, however, amounted to 67.8 billion yuan compared with 52.7 billion yuan in 2013.

Starting out as a small company set up by Guo in 1992, Fosun has pursued an aggressive overseas expansion policy starting in 2010. It now owns Portugal’s largest insurance group, Fidelidade, French luxury resort operator Club Med, a 9.5 per cent stake in jewellery and fashion accessories brand Folli Follie and a minority stake in entertainment company Cirque du Soleil.

Fosun resumes its overseas shopping spree with US$52m purchase of Brazil asset manager

It also took a large chunk of shares in China’s Tsingtao Brewery from Japanese brewer Asahi in December, and announced this month that it was buying a controlling stake in the Austrian loss-making luxury lingerie and legwear specialist, Wolford. It is also a major shareholder of the French fashion label, Lanvin.