Ping An Insurance (Group) Company Of China Ltd(601318) (601318)
Report cause
Ping An Insurance (Group) Company Of China Ltd(601318) is at the key node of reform, and reform is not easy. Standing at the current time point and focusing on the four issues most concerned by the market, we use history as a reference and look forward to changes. We believe that the long-term allocation value of Ping An Insurance (Group) Company Of China Ltd(601318) is prominent.
Core view
What is the prospect of life insurance reform? When can the property insurance business recover? The three major reforms and transformations of the company are ahead of the industry. Although the new order and value rate have experienced pains in the short term, the agent capacity has remained stable and increased slightly in the case of decline in scale. We believe that the company is expected to realize the comprehensive transformation and upgrading of channels, products and operations next year, and the solid stock business also gives a stable growth momentum of embedded value. Although the auto insurance has declined under the influence of the epidemic, there is no further downward pressure on the first anniversary of the commercial car fare reform. The credit guarantee insurance has taken the initiative to shrink the scale. At the same time, cor has been greatly improved. Italian health insurance has also ushered in rapid growth in the process of activating residents’ security awareness. We expect that the premium and quality of property insurance are expected to increase simultaneously.
Can the steady return on investment be sustained? What is the future of fintech? The company’s long-term investment return is stable and better than the market. Although the storm of some short-term real estate risk projects has led to the spread of pessimism, the company has fully accrued impairment and is expected to realize reversal with the promotion of debt repayment scheme, and the multi asset layout will also bring a more stable risk and income match. The company’s investment in science and technology is relatively stable. On the one hand, science and technology enables traditional finance to bring remarkable results in digital transformation. On the other hand, science and technology subsidiaries are gradually incubated and are comprehensively promoting from scenario to profit, which has a strong boost effect on the value of the company.
The growth of the company is shared from top to bottom, and the cross sales effect is gradually reflected. The excellent ownership structure gives the management greater decision-making flexibility, and the market-oriented incentive mechanism also binds the interests of the management, employees and shareholders, ensuring the effective implementation of the long-term strategy. The customer-centered business philosophy, combined with the comprehensive financial strategy of continuous promotion, the cross sales effect has gradually become prominent. The stable breakthrough personal business and sustainable development group business are the core driving factors for the profit growth and development progress of the group.
Financial forecast and investment suggestions
The sotp valuation method is used to evaluate the overall value of the company. It is expected that the target market value in 2022 will be 1302.3 billion yuan and the target price will be 71.24 yuan / share. The corresponding P / EV valuation of the group in 2022 will be 0.78x. It will be covered for the first time and given a “buy” rating.
Risk statement
The sales of new orders were less than expected, the long-term interest rate continued to decline, the equity market fluctuated sharply, the impairment risk of equity investment was accrued, and the policy risk was.
