\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 336 New China Life Insurance Company Ltd(601336) )
Core view
In 2021, the performance was slightly lower than expected, the scale remained stable, the value scale was under pressure, the investment income rose, and the net profit increased steadily. In 2021, the total premium income was 163.5 billion yuan (+ 2.5%), the first year premium of long-term insurance was 21.8 billion yuan (+ 4.0%), the value of new business was 6 billion yuan (- 34.9%), the value ratio of new business of standard premium decreased by 9.7 percentage points to 20.7%, the operating profit was 14.9 billion yuan (+ 4.6%), the net profit attributable to the parent company was 14.9 billion yuan (+ 4.2%), the cash dividend was 4.5 billion yuan (+ 3.6%), and the embedded value was 258.8 billion yuan (+ 7.6%). The scale of insurance business is expected to remain stable and the value of insurance channels is expected to remain stable. In 2021, the total premium was 163.5 billion yuan (+ 2.5%), including 119.8 billion yuan (+ 2.1%) for individual insurance channels, 40.7 billion yuan (2.5%) for bancassurance channels, and 410 yuan (+ 5.0%) for long-term insurance in the first year, with an increase of 0.6 percentage points, which remained stable as a whole.
From the perspective of premium by channel, the contribution of Bancassurance channel increased. For personal insurance channels, the first year premium of long-term insurance was 15.4 billion yuan (- 3.0%), the first year regular premium of long-term insurance was 14.6 billion yuan (- 4.5%), the scale manpower decreased to 390000 (- 35.8%), the average qualified manpower was 90000 (- 28.9%), and the average qualified rate decreased by 4.7 percentage points to 19.1%. In the bancassurance channel, the first year premium of long-term insurance is 25.2 billion yuan (+ 9.5%), and the first year premium of long-term insurance is 7.2 billion yuan (+ 26.7%).
Looking at the first year premium of long-term insurance by product, traditional insurance contributed to the growth of new policies, health insurance declined, and dividend insurance remained stable. Health insurance was 8.4 billion yuan (- 18.8%), traditional insurance was 14.3 billion yuan (+ 33.6%), and dividend insurance was 18.2 billion yuan (+ 1.6%).
In terms of the continuation rate, the continuation rate is expected to stabilize. The 3-month continuation rate and 25 month continuation rate were close to 83.8% and 83.7% respectively, down 6.1 and 0.2 percentage points respectively.
Investment business: the asset scale showed double-digit growth, the total return on investment rose, and the allocation of equity assets improved. The asset scale was 108.3 billion yuan (+ 12.1%), the total return on investment was 5.9%, with a year-on-year increase of 0.4 percentage points, and the net return on investment was 4.3%, with a year-on-year decrease of 0.3 percentage points. In terms of allocation, the proportion of bond financial assets decreased by 5.5 percentage points year-on-year to 53.3%, of which the proportion of bonds and debts decreased by 1.9 percentage points year-on-year to 38.5%, while the proportion of equity financial assets increased by 2.4 percentage points to 23.8%, of which the proportion of funds increased by 1.2 percentage points to 7.0%.
Investment suggestion: under the steady growth policy, the policy valuation is expected to improve and maintain the "buy" rating. We expect that the net profit attributable to the parent company from 2022 to 2024 will be 16.6/19.8/23.3 billion yuan, with a year-on-year growth rate of 11 / 20 / 17%. The diluted EPS will be 5.3 / 6.4 / 7.5 yuan, and the corresponding PE of the current stock price will be 7 / 6 / 5x. It is recommended to pay attention and maintain the "buy" rating.
Risk tip: the value scale of new orders has declined, and the net return on investment has continued to decline.
