\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 318 Ping An Insurance (Group) Company Of China Ltd(601318) )
The value of new business was lower than expected, and the banking and asset management sectors performed well, maintaining the “buy” rating
The company disclosed the 2021 annual report, nbv378 in 2021 The year-on-year adjustment rate is expected to be -2021.6 billion yuan, which is mainly lower than the year-on-year adjustment rate of -8.5 billion PCT; EV of the group was + 5.1% year-on-year, lower than our expectation, mainly due to the deviation of investment income, the slowdown of NBV growth and the drag of non operating profits of other businesses; The operating profit was 147.96 billion yuan, a year-on-year increase of + 6.1%, mainly driven by banking, asset management and other sectors. The operating profit of life insurance was 97.08 billion yuan, a year-on-year increase of + 3.6%, and the operating profit was roe32.2% 3%, down 2.7pct year-on-year. The net profit attributable to the parent company was 101.62 billion yuan, a year-on-year increase of – 29.0%. Taking into account the decline in the scale of agents, the decline in margin and the critical stage of life insurance transformation, we reduced the year-on-year growth rate of NBV from 2022 to 2023 to – 7.5% (previous value + 7.3%), + 3.4% (previous value + 8.4%) and increased the forecast for 2024 to + 8.9%. It is expected that the EV of the group will be + 12.0%, + 10.8% and + 10.4% respectively year-on-year. Considering that the profits of banking, property insurance and other sectors are stable and can bring certain growth, we raised the net profit attributable to the parent company of the group from 2022 to 2023 to 167.6/185.2 billion yuan (147.1/175.2 billion yuan before the adjustment), and increased the forecast of 20.25 billion yuan in 2024, corresponding to eps9.5 billion yuan 17 / 10.13 / 11.08 yuan. The company is a leader in the insurance industry. The reform of life insurance is expected to go further. With the superposition of comprehensive financial advantages, the valuation is at a historical low. The current share price corresponds to 0.5/0.5/0.4 times of PEV from 2022 to 2024, maintaining the “buy” rating.
The weakness of new life insurance orders and the decline of margin drag down the growth rate of NBV, and the property insurance sector is expected to have marginal improvement
In 2021, the new single premium of NBV was 136.29 billion yuan, a year-on-year increase of – 8.5%. The increase in the proportion of savings products and the adjustment of assumptions led to the decline of margin by 5.5pct to 27.8%. The pressure on the new single premium and the decline of margin dragged down NBV. At the end of 2021, there were Shanghai Pudong Development Bank Co.Ltd(600000) agents, with a quarter on quarter increase of – 15.0%, compared with – 41.4% at the beginning of the year. The decline was greater than the increase of per capita production capacity, and the manpower scale fell to the level of 2014. It is expected to decline further in 2022. Considering that the transformation is still in deep water, NBV may be under pressure year-on-year in 2022. Since the pressure of comprehensive reform of auto insurance has eased, the property insurance sector has achieved relatively rapid growth driven by auto insurance, and the comprehensive cost rate is expected to maintain a better level driven by the increase of average vehicle premium. The average health insurance of low parts in the industry has increased rapidly, and the property insurance sector is expected to have marginal improvement.
The rate of return on investment continued to rise, and the risks in the real estate chain were gradually resolved, driving the recovery of the asset side
In 2021, the net return on investment was 4.6% (2021q34.2%), the total return on investment was 4.0% (2021q33.7%). The contracted amount of China Fortune Land Development Co.Ltd(600340) debt restructuring plan was 42.9 billion yuan, accounting for 19.6% of the total financial debt. The disposal of risk events was further promoted. Ping An Insurance (Group) Company Of China Ltd(601318) its risk exposure is expected to be further controlled, and the market’s concern about the asset side is expected to be alleviated.
Risk tip: the long-term interest rate is lower than expected; The process of life insurance reform was blocked beyond expectations.
