China Pacific Insurance (601601) Commentary Report: New Single-Term Delivery Decline Increases GDR or Short-term Repression Factors

Event: On the evening of October 30, 2019, CPIC announced its third-quarter results for 2019, with net profit attributable to its mother of 22.9 billion, an increase of 80 during the same period.

2%, comprehensive income attributable to mothers was 29.7 billion, a year-on-year increase of 133%.

Investment points: Net profit maintained a high growth rate, and net assets increased earlier.

8%: The Group’s net profit attributable to its mothers in the first three quarters was 22.9 billion, an annual increase of 80%.

8%, maintained a rapid growth, mainly driven by the new tax reduction policy, the income from 76.

200 million expected -4.

500 million (48 of which were returned in ten years in 2018.

800 million), profit before tax only increased by 11.

2%, mainly due to limited improvement in income statement investment income and changes in actuarial assumptions to increase reserves.

Due to the better performance of the equity market, the comprehensive return to motherhood reached 29.7 billion, which promoted the early growth of net assets.

8%, the best level in recent years.

The decline in new single-term life insurance transactions expanded, and the value of new business increased under pressure: CPIC Life Insurance’s premium income in the first three quarters was 185.9 billion, an increase of 5.

0%, one of which is 29.6 billion in new orders, down 18 a year.

6%, a decrease from the first half (-16.

1%) has been expanded. It is expected 天津夜网 that the growth rate of new business value in the first three quarters will not improve, but it will be difficult to see a significant improvement.

Facing the current unfavorable situation, the company proposes “focus on value, focus on team, focus on empowerment”, build three key teams, enlarge core manpower, strengthen top performance, cultivate new generations, and strengthen training and sales support construction.Efficiency and value creation capabilities will be enhanced.

Investment assets have grown rapidly, with a total return on investment of 5.

1%: As of the end of September, the Group’s investment assets increased by 11 compared with the beginning of the year.

1% to 1.

37 trillion, of which 82 were solid income.

2%, stock + equity funds accounted for 7.

8%, a rise of 0 at the end of June.

4pct, 北京夜生活网 still significantly lower than the major peers.

In terms of investment yield, the net investment yield is 4.

8%, flat for one year, with a total investment return of 5.

1%, a year to raise 0.

4pct.

Profit forecast and investment advice: Under the assumption of 5% return on investment, the EPS for 2019-2021 is predicted to be 3.

08/2.

98/3.

40 yuan, corresponding to PE is 11.

22/11.

58/10.

16 times, EVPS is 42.

96/47.

67/53.

04 yuan, corresponding to PEV of 0.

80/0.72/0.

65 times the current estimated budget.

However, as GDR is being promoted, from the experience of Huatai Securities, if there is a discount in the issue price, it will form an arbitrage space, short-term or suppressive factors, and gradually reflect some performance.

In terms of long-term value, CPIC’s profitability is stable and its dividend payout ratio is relatively high. It is currently estimated to be low. After the risk is gradually released, the market performance can be expected and the rating of “Buy” is maintained.

Risk factors: transformation 2.

0 advance was less than expected, and interest rates fell more than expected.