\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) China Pacific Insurance (Group) Co.Ltd(601601) 601)
NBV was lower than expected, and “Changhang plan” led the transformation of life insurance and maintained the “buy” rating
The company disclosed in the annual report of 2021 that NBV in 2021 was 13.41 billion yuan, with a year-on-year decrease of – 24.8%, an increase of 15.9pct compared with the decrease of – 8.9% in the interim report, which was lower than our previous expectation, mainly due to the decrease of margin by 15.4pct to 23.5% compared with 2020; At the end of 2021, ev of the company was 498.31 billion yuan, a year-on-year increase of + 8.5%, and the year-on-year growth rate slowed down, which was mainly affected by the year-on-year pressure of NBV; The operating revenue was 444.64 billion yuan, a year-on-year increase of + 4.4%, the net profit attributable to the parent company was 26.83 billion yuan, a year-on-year increase of + 9.2%, and the operating profit was 35.34 billion yuan, a year-on-year increase of + 13.5%. Considering that the company’s transformation is in a critical period, margin and new single premium may be under pressure, we lowered the NBV forecast from 2022 to 2023 to – 9.7% / + 14.5% (before adjustment + 18.2% / + 15.7%), increased the forecast for 2024 to + 9.5%, and the corresponding EV was + 10.4% / + 11.7% / + 11.4% year-on-year. The net profit attributable to the parent company lowered the forecast for 2022 to 35.3 billion yuan (before adjustment 40.2 billion yuan), and raised the forecast for 2023 to 51.5 billion yuan (before adjustment 44.4 billion yuan), The new forecast for 2024 is 56.5 billion yuan, corresponding to EPS of 3.78/4.51/6.05 yuan. The company is a leader in the insurance industry. The “long voyage plan” has been comprehensively deepened. The management continues to promote the transformation and upgrading of the team of life insurance agents. It is expected that the transformation of agents is ahead of the industry, and the valuation is expected to be repaired. The current share price corresponds to 0.4 / 0.4 / 0.3 times the PEV from 2022 to 2024, maintaining the “buy” rating.
The life insurance agent channel deepened the transformation, the bancassurance channel set sail again, and pay attention to the follow-up transformation progress
In 2021, the new single premium of CPIC life insurance agent channel was 29.2 billion yuan, a year-on-year increase of – 0.2%, of which the fixed-term payment business was 24.7 billion yuan, a year-on-year increase of + 11.6%, but the margin decreased from 61.1% to 42.6%, which is expected to be caused by the adjustment of product structure, continuation rate and other assumptions. The company disclosed the performance of Bancassurance channel. In 2021, it contributed 6.6 billion yuan of new policy premium, a year-on-year increase of + 331.3%, 300 million yuan of new policy value, a year-on-year increase of + 167.5% and a margin of 3.3%. The resumption of Bancassurance channel may strongly support the company’s premium. The proportion of the company’s “top-level design team” is expected to be further accelerated in the second half of the year, accounting for 23.7% of the company’s “top-level design team”, which is expected to be lower than that in the fifth half of the year. In 2021, the average monthly premium income of agents in the first year was + 42.3% year-on-year, and the Commission in the first year was + 16.3% year-on-year. The production capacity was improved to a certain extent, and the transformation of the liability side of life insurance may lead the industry.
Property insurance adheres to high-quality development, and the comprehensive cost structure has been optimized
In 2021, the premium of property insurance was 152.6 billion yuan, with a year-on-year increase of + 3.3% (the first three quarters + 3.0%), the auto insurance was 91.8 billion yuan, with a year-on-year increase of – 4.0% (the first three quarters – 8.0%), and the non auto insurance was 60.8 billion yuan, with a year-on-year increase of + 16.9% (the first three quarters + 21.4%), and the proportion of non auto insurance decreased by 4.2pct to 39.9% month on month. The comprehensive cost ratio was 99.0%, which was the same as that in 2020. The expense ratio decreased by 8.2pct to 29.4%, and the loss ratio increased by 8.2pct to 69.6%. The cost structure was optimized. The company’s property insurance adheres to high-quality development and is expected to realize vehicle and non vehicle two wheel drive. We expect the property insurance premium to be + 12.3% / + 12.2% / + 13.2% year-on-year from 2022 to 2024. The market pattern is expected to be optimized and the market position will continue to improve.
Risk tip: the long-term interest rate is lower than expected; The scale of the agent team decreased more than expected.
