报告名称：PICC Group(01339.HK)40% YoY preliminary net profit growth beats consensus
报告类型：港股研究
报告日期：2016-02-11
研究机构：大和证券
股票名称：中国人民保险集团
股票代码：01339
页数：6
简介：PICC Groupˇs preliminary 2015E net profit is 5% ahead of consensus
Reiterating Buy (1) rating with a lower TP of HKD3.75
We continue to favour China Pacific over China Life
What's new: PICC Group announced that its preliminary 2015 net profitincreased by around 40% YoY, which is 5% ahead of the Bloombergconsensus estimate. This translates into a 1% YoY earnings increase for2H15 amid investment headwinds. We expect PICC Group to announce aVNB growth turnaround when it releases its full results in late March.
What's the impact: According to the announcement, the increase in PICCGroup’s net profit is “mainly attributable to the significant increase ininvestment income in the year of 2015 as compared to the previous year.”
What we recommend: We reiterate our Buy (1) call on PICC Group and trimour SOTP-derived 12-month TP to HKD3.75 (from HKD4.10), due mainly tomark-to-market losses on A-share investments. Our TP implies a 2016E P/EV(group) of 1.1x. For the same reason, we lower 2015-17E earnings by 2-7%.Key risk: solvency margin at PICC Life, which is likely to drop under C-ROSS.
Five of the 9 Hong Kong/China-listed insurers have announced preliminarynet profits or given profit alerts, including China Pacific (CPIC; 2601 HK,HKD26.35, Buy [1]), PICC P&C (2328 HK, HKD12.16, Hold [3]), and PICCGroup (1339 HK, HKD2.88, Buy [1]). We are most impressed by CPIC’searnings beat, which we believe is not only a result of decent investmentincome but also suggests its P&C operation may have bottomed out (ie, byachieving underwriting break-even). Following on from our rating upgradeearlier this year, CPIC remains our top sector pick (see CPIC: Strongagency VNB expansion 5 January 2016).
We are most disappointed by China Life’s (2628 HK, HKD17.6,Outperform [2]) 20% earnings miss relative to consensus. Also, wecontinue to see headwinds for China Life on the earnings side (due to areserve valuation rate revision and an unfavourable investment strategy)and the VNB side (due to a large volume of high-guarantee-rate 2016 NewYear Sales products). Hence, we continue to favour CPIC over China Life.

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