At the beginning of the year of the tiger, the rise of insurance stocks attracted the attention of the market. As of the closing on February 9, the insurance sector index rose by 5.38% in the three trading days of the year of the tiger. Many industry insiders believe that there are obvious signs of recovery of insurance stocks, and the support point may be closely related to the oversold rebound, capital sneaking in and the recovery of fundamentals.
The above industry insiders said that after the ups and downs in 2021, the valuation attractiveness of insurance stocks has greatly improved, and the fundamentals of the insurance industry are also improving. At the same time, the financial Associated Press reporter found that since the beginning of the year, northbound funds have obviously shown a preference for insurance stocks. According to the data, as of February 8, the shareholding of northbound funds in The People'S Insurance Company (Group) Of China Limited(601319) , New China Life Insurance Company Ltd(601336) , China Pacific Insurance (Group) Co.Ltd(601601) , China Life Insurance Company Limited(601628) , Ping An Insurance (Group) Company Of China Ltd(601318) increased by 37.7%, 15.1%, 10.03%, 6.24% and 9.31% respectively compared with December 31 last year.
Does this mean that insurance stocks will get out of the haze in 2022? A number of brokerage analysts also said, "the continuous rise of insurance stocks remains to be observed. Although the fundamentals have improved, there are still hidden worries. The annual report season is coming soon, and the data is worthy of attention."
high safety margin, oversold and rebound?
In the past 2021, the A-share insurance index continued to decline, losing CSI 300. Data show that the insurance sector as a whole fell 39% in 2021. Among them, Ping An Insurance (Group) Company Of China Ltd(601318) , New China Life Insurance Company Ltd(601336) , The People'S Insurance Company (Group) Of China Limited(601319) , China Pacific Insurance (Group) Co.Ltd(601601) , China Life Insurance Company Limited(601628) decreased by 39.2%, 29.2%, 24.4%, 21.7% and 17.8% respectively.
According to the Research Report of Orient Securities Company Limited(600958) , as of the fourth quarter of last year, the free circulation market value of the insurance sector accounted for 1.97%, an increase of 0.23% compared with the third quarter of 2021. The low allocation range of the sector further set a new record. As of the fourth quarter of 2021, the low allocation range of the insurance sector increased to 91.26% month on month from 88.77% in the third quarter of 2021, especially compared with the high allocation range of 47% in the third quarter of 2018, indicating that the investment sentiment of the sector has fallen to the historical freezing point.
There seems to be some insight into the opportunity for insurance stocks to rebound in 2022. In January, the shareholding of northbound capital in the five major A-share insurance stocks increased significantly compared with last year, among which the shareholding of The People'S Insurance Company (Group) Of China Limited(601319) and New China Life Insurance Company Ltd(601336) increased by more than 20%.
According to wind data, in the three trading days of the year of the tiger, on February 7, northbound funds bought a net 5.552 billion yuan. Among the top ten traded stocks, Ping An Insurance (Group) Company Of China Ltd(601318) had the largest net purchase, reaching 1.035 billion yuan; On February 8, Ping An Insurance (Group) Company Of China Ltd(601318) still ranked first among the top ten traded stocks of northbound capital, with a net purchase of 546 million yuan. On February 9, northbound funds maintained a net inflow trend in the intraday trading, with a net purchase of more than 3 billion yuan at one time and a return in the late trading, with a net purchase of 484 million yuan throughout the day.
In addition, Ping An Insurance (Group) Company Of China Ltd(601318) repurchase of its own shares is also continuing. On February 8, Ping An Insurance (Group) Company Of China Ltd(601318) announced that as of January 31, 2022, 77765100 A shares had been repurchased, accounting for 0.42541% of the total share capital of the company. The total amount of funds paid is 3.899 billion yuan (excluding transaction costs), the minimum transaction price is 48.18 yuan / share, and the maximum transaction price is 51.96 yuan / share.
Brokerage analysts generally believe that the current valuation and market expectation of the insurance sector are at a historically low level with a high margin of safety.
bottom repair, basically good
According to a number of market participants interviewed by the financial Associated Press, the overall situation of the insurance industry is also picking up.
Orient Securities Company Limited(600958) believes that from the debt side, the scale of the team with clear deficiency has gradually formed, the production capacity of the remaining team has been improved, and it is expected to start a good start gradually; The inflection point of property insurance has come, and we expect the synchronous improvement of premium and comprehensive cost rate.
On the investment side, the outlook of the equity market is optimistic, and the liberalization of the investment ceiling adds upward flexibility. Under the background of market fluctuations, large insurance enterprises will accelerate the extension expansion of pension communities and commercial real estate, so as to alleviate the pessimistic expectation of the market for interest margin loss. At the same time, it is expected to feed back the main business of life insurance, so as to realize the combination of medical care and nursing, and improve customer stickiness and secondary development.
In the 2022 annual strategy report of the insurance industry, Huachuang securities took the dormancy at the bottom and waiting for a new round of prosperity and growth as the title. It believed that the current liquidity tension and overdue debt problems of real estate enterprises had caused practical performance damage to insurance enterprises. However, with the relaxation of policy margin and the release of liquidity risk of real estate enterprises, it is expected to bring some valuation and repair space to insurance enterprises.
Huachuang Securities believes that in the long run, there will be several types of insurance companies that can cross the cycle, break through the bottleneck and usher in new growth in the future: one is companies that form barriers on the infrastructure of medical, health and elderly care services; One is the company that has truly outstanding long-term asset management capability; There are also companies that can break the shackles, balance interests and truly build high production capacity and deep barrier sales channels. Large listed insurance companies have significant advantages and barriers in all aspects.
According to the premium data, there are obvious signs of recovery at the debt end of the industry. According to the latest premium data, the monthly premiums of Ping An Life Insurance, China Life Insurance Company Limited(601628) , PICC Property Insurance, Ping An Property Insurance, CPIC property insurance and other insurance companies showed rapid month on month growth in December last year.
the pressure is still there. Be alert to the cold current
Although the overall warming trend is obvious, the liabilities and investment ends of the insurance industry are still under pressure, and the haze hanging over the industry in 2021 has not completely dissipated.
In recent years, under the influence of multiple factors such as macro-economy, regulatory system and covid-19 epidemic, the development of the insurance industry has encountered great challenges. The growth of new policy premiums is under pressure, the industry competition is significantly divided, the sales manpower continues to shrink, and the market forces the operation transformation, which is considered as the time period of transformation and reform by the industry.
According to the analysis of the management of a large insurance enterprise, "the policies affecting the insurance industry are relatively 'stable' in 2022. There are many industrial policies in 2021, and the impact is relatively wide. In the transformation and reform of the industry, we mainly focus on the two major issues of life insurance demand and channels."
According to the prediction of China International Capital Corporation Limited(601995) analyst team, the life insurance industry will enter the "post serious illness era", and the key is to find and develop the demand for diversified insurance products; The changes in the characteristics of potential customers have put forward new requirements for the industry's sales channels. In the future, the premium growth will mainly come from the improvement of the production capacity of sales personnel; After the adjustment of products and channels, the industry value rate will go down to a new normal.
Haitong Securities Company Limited(600837) analysis shows that in the first quarter of 2022, new life insurance orders may still face negative growth, while the number of agents decreases significantly, and the liability side will continue to be under pressure. The yield of 10-year Treasury bonds fell to about 2.7%, and fixed income investment was significantly under pressure.
According to the analysis of a medium-sized property insurance person, "the auto insurance premium may increase steadily in 2022, but the impact of the comprehensive reform of auto insurance continues, and the continuous rise of health insurance deserves attention."
On the asset side, Huachuang Securities believes that it also faces the challenge of complex macro environment. First, the macroeconomic situation is grim. The yield of 10-year Treasury bonds fluctuates downward and enters the range below 3.3% after 2019. Around 2015, the high-yield non-standard assets gradually matured, and there was no corresponding risk asset matching in the market, so the due reinvestment was under pressure.
The net return on investment of each company has gradually decreased since 2017, but based on the good performance of the equity market after 2019, the total return on investment of each company has a good performance after 2018. The liquidity of real estate enterprises has become tense in stages, and many real estate enterprises have bond defaults, which has a substantial impact on the performance of insurance enterprises and triggered market concerns. However, with the maintenance of stability of policies, the risks are expected to be released gradually.
In conclusion, the pressure on the insurance sector remains in 2022, and all kinds of hidden worries need to be paid attention to in the recovery of the general trend.
