\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) China Pacific Insurance (Group) Co.Ltd(601601) 601)
1. The net profit attributable to the parent company (5.44 billion) was – 36.4% year-on-year, mainly due to the fluctuation of the capital market. In 2022q1, the company’s annualized return on total investment was 3.7%, with a year-on-year rate of -0.9pct; The annualized net return on investment was 3.7%, with a year-on-year increase of -0.2pct; The total book investment income decreased by – 34.5% year-on-year to 17.3 billion, and the book floating profit narrowed from 19.7 billion to 9 billion. The group’s net assets attributable to the parent company increased by – 2.3% year-on-year to 221.5 billion yuan.
2. Life insurance: Q1 new policy premium + 22% to 28.4 billion, but mainly driven by bancassurance channels, the overall margin decreased significantly. Among them, the new single premium of agent channel was 9.2 billion, a year-on-year increase of – 44.1%; The new single premium of Bancassurance channel was RMB 11 billion, a year-on-year increase of + 1108%, realizing rapid growth under a low base. The company continued to focus on transformation, fully launched the first phase of the “long voyage action” project from the beginning of the year, launched the “core” basic law, and created a professional marketing of “three modernizations and five most”. Q1 agent’s monthly per capita insurance business income in the first year was + 19.9% year-on-year; The per capita capacity of core manpower increased year-on-year and month on month, and the team structure improved. In terms of business quality, the continuation rate of insurance policy in March was 89.0%, with a year-on-year increase of + 5.3pct.
3. Property insurance: premium income increased by + 14% to 49.9 billion yuan year-on-year, of which auto insurance income increased by + 11.8% year-on-year and non auto insurance income increased by + 16.2% year-on-year. The comprehensive cost rate was -0.2pct To 99.1%, of which the loss ratio is + 1.8pct To 70.4%, and the expense rate was – 2.0% to 28.7% year-on-year.
Investment view: the overall performance is in line with expectations. After March, the base pressure will be reduced, and the decline of NBV is expected to narrow marginally, but it is expected to still lag behind the listed peers. It is expected that NBV in the whole year will be – 30% year-on-year. The transformation direction of long-term corporate life insurance is very clear. First, the construction of excellent team and excellent culture, and second, the construction of differentiated services such as health care have achieved preliminary results. We estimate that the net profit attributable to the parent company in 20222024 will be 21.24 billion, 24.42 billion and 30.15 billion respectively, and yoy will be – 20.8%, 14.9% and 23.5% respectively (the previous estimate of net profit attributable to the parent company in 20222024 will be 27.09 billion, 33.22 billion and 41.91 billion respectively). The reduction of profit forecast is mainly due to the intensification of stock market turmoil this year and the reduction of investment return expectation. At present, the company’s 2022pev is only 0.37 (a) / 0.26 (H) times, which is at a historical low valuation.
Risk tip: the rapid decline of interest rate exceeded expectations, the decline of agent scale exceeded expectations, the sales of guaranteed products were less than expected, and the epidemic situation was repeated.
