Core view
The special meeting of the financial committee stabilized market expectations and boosted market sentiment, releasing the positive effects of capital market policies. The special meeting of the finance committee made a comprehensive response to the important issues concerned by the market in the near future, including macroeconomic, real estate policy, China concept stock fluctuation, platform economic governance and the stability of Hong Kong’s financial market. With regard to the capital market, the CSRC pointed out: 1) solidly promote the comprehensive implementation of the reform of the stock issuance registration system. 2) Give full play to the role of endogenous market stability mechanism and vigorously promote listed companies to improve quality. 3) Improve the institutional mechanism conducive to the participation of long-term institutional investors in the capital market. This special meeting will undoubtedly inject a booster into the A-share market in difficult times, stabilize market expectations and is expected to boost sentiment. At the same time, the acceleration of the comprehensive registration system reform to the main board and the continuous process of market institutionalization are expected to improve the value discovery function, focusing on the securities industry.
The proportion of stock settlement provisions was reduced to release incremental funds. In order to implement the spirit of the special meeting of the financial commission, China Clearing, in cooperation with the ongoing DVP reform, reduced the payment proportion of the minimum settlement provision for stock business from 18% to 16%. According to the calculation of the closing balance of customer transaction settlement funds in the securities industry of 1.9 trillion at the end of the year, assuming that 50% – 100% of the funds are used for stock trading, about 19-38 billion yuan of incremental self owned funds will be released, which will reduce the occupation of funds and reduce the cost of funds in the market.
Chinese and American regulators have stated that China concept shares are expected to usher in the end of the policy. 1) At this special meeting, the CSRC also pointed out to further promote high-level opening-up, continue to strengthen communication with US regulators, and strive to reach an agreement on China US audit and supervision cooperation as soon as possible. We will promptly promote the implementation of new regulations on the supervision of overseas listing of enterprises, support all kinds of qualified enterprises to list abroad, and maintain smooth channels for overseas listing. 2) Recently, the US public company accounting oversight board (PCAOB) said that it is maintaining active communication with Chinese regulators and has held talks for many times recently. The two sides are committed to reaching a cooperation agreement so that it can inspect Chinese and some Hong Kong audit firms registered in the United States and engaged in mainland business. Recently, China and the United States have stated that the regulatory contradictions around China concept shares show a trend of gradual resolution. Since last year, the biggest negative factor suppressing the valuation and market of China concept shares is expected to usher in an upward turning point.
Ping An’s parent operating profit in 2021 is + 6%. It is suggested to continue to pay attention to the property insurance sector in the rising channel Ping An Insurance (Group) Company Of China Ltd(601318) 2021 EV increased by 5.07%, which was lower than expected. In addition to the weakening of NBV kinetic energy, it was also dragged down by the negative deviation of operation experience and investment return; The company’s life insurance reform is still advancing, and NBV is still under significant pressure. Although the scale of individual insurance team has decreased by 41% year-on-year, the production capacity has increased and the income is stable. Property insurance business has stepped into the upward channel of both quantity and quality. The premium pressure under the influence of comprehensive reform of auto insurance has gradually subsided, and cor has been significantly optimized. It is suggested to actively pay attention to high-quality leading targets.
Investment proposal and investment object
In terms of securities companies, double click on market liquidity and policy, continue to be optimistic about the spring market of the sector, select high-quality targets with fundamentals, and maintain the optimistic rating of the industry. At present, it is still the first to promote the main line of derivatives, recommending Citic Securities Company Limited(600030) ( Citic Securities Company Limited(600030) , overweight), Huatai Securities Co.Ltd(601688) ( Huatai Securities Co.Ltd(601688) , overweight), and paying attention to China International Capital Corporation Limited(601995) (03908, not rated); Secondly, we should continue to pay attention to the main line of public offering and recommend Gf Securities Co.Ltd(000776) ( Gf Securities Co.Ltd(000776) , buy) and China Industrial Securities Co.Ltd(601377) ( China Industrial Securities Co.Ltd(601377) , increase Holdings).
In terms of diversified finance, A-Shares recommend the leading lessee of aerial working platform (AWP) Zhejiang Huatie Emergency Equipment Science & Technology Co.Ltd(603300) ( Zhejiang Huatie Emergency Equipment Science & Technology Co.Ltd(603300) , buy); Hong Kong stocks recommend Far East Hongxin (03360, buy), a leader in financial leasing, and BOC aviation leasing (02588, overweight), a leader in Asia Pacific Aircraft leasing; US stocks recommend Noah wealth (Noah. N, buy), a third-party high net worth financial management leader.
The scale of the insurance team is expected to be gradually improved and the remaining capacity is expected to be gradually improved; The inflection point of property insurance has arrived, and we look forward to the synchronous improvement of premium and cor; The outlook of the equity market is optimistic, and the liberalization of the investment ceiling adds upward flexibility. We are optimistic about large insurance companies that actively promote reform and enhance production capacity through science and technology empowerment and cross sales, and maintain the optimistic rating of the industry. Follow up suggestions focus on Ping An Insurance (Group) Company Of China Ltd(601318) ( Ping An Insurance (Group) Company Of China Ltd(601318) , buy), China Pacific Insurance (Group) Co.Ltd(601601) ( China Pacific Insurance (Group) Co.Ltd(601601) , not rated), AIA (01299, not rated).
Risk tips
The suppression of systemic risk on the performance and valuation of securities business; Stricter supervision than expected;
The long-term interest rate is lower than expected; Related policy risks in diversified financial field.
