\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 336 New China Life Insurance Company Ltd(601336) )
Event: the company disclosed that in the first quarter report of 2022, it achieved operating revenue of 75 billion yuan (yoy-8%), net profit attributable to the parent company of 1.3 billion yuan (yoy-79%), and earnings per share of 0.43 yuan (yoy-79%). The company’s Q1 long-term premium for new policies fell by 18% year-on-year, and the renewal premium increased by 8% year-on-year. Affected by the fluctuation of capital market in the first quarter, the company’s Q1 annualized total return on investment was 4%, down 3.9pct year-on-year
The new single premium increased negatively, and the performance of Bancassurance was better than that of individual insurance. The company achieved premium income of 64.9 billion yuan (YoY + 2.4%) in 2022q1, including 21.1 billion yuan (yoy-2.9%) for new long-term insurance, 900 million yuan (yoy-63.3%) for ten-year term and above, and 42.4 billion yuan (YoY + 8.0%) for renewal. From the perspective of different channels, 1) due to the superposition of multiple factors, new individual insurance policies are still weak. The company achieved premium income of 42.8 billion yuan (yoy-5.3%) through 2022q1 individual insurance channels, including 5.8 billion yuan (yoy-22.6%) for new long-term insurance policies and new long-term insurance policies. 2) The proportion of Bancassurance channel premiums increased. The company focused on deepening channel cooperation and optimizing product structure. In Q1, bancassurance channel achieved a premium income of 21.2 billion yuan (YoY + 25.7%), accounting for 32.7% (YoY + 6.1pct.). Among them, the first year premium of long-term insurance is 15.2 billion yuan (YoY + 8.4%), and the renewal premium is 6 billion yuan (YoY + 112.3%).
The individual insurance team is waiting for stabilization and transformation. Affected by the reduction of marketing manpower, the new individual insurance policies of the company showed a significant negative growth in the first quarter of 2022. Implement the company’s “quality improvement plan” in the second quarter; At the same time, we will build a “new city”, develop a new marketing ecosystem of “science and technology + team + service”, obtain customers online, raise customers online and manage online through scientific and technological means, and connect with emerging, flat and high performing teams.
The investment income decreased significantly, which dragged down the sharp decline of net profit. As of Q1 2022, the company’s investment assets were 1096.1 billion yuan, an increase of 1.2% over the beginning of the year; In 2022q1, the return on investment is 11.9 billion yuan (yoy-39%), and the annual total return on investment is 4.0% (yoy-3.9pct.), Mainly due to the sharp withdrawal of the equity market in the first quarter, the market performance was sluggish, dragging down the net profit by 79% year-on-year.
Investment suggestion: buy – a investment rating. It is estimated that the EPS of New China Life Insurance Company Ltd(601336) 20222024 will be 6.4 yuan, 7.8 yuan and 8.7 yuan respectively, corresponding to 0.4 times of 2022pev, and a 6-month target price of 44 yuan will be given.
Risk warning: due to the impact of the epidemic, the premium income of new policies has fallen sharply / the risk of a large number of agents falling off / the uncertainty of regulatory policies / the risk of sharp fluctuations in the secondary market
