Haitong International released a research report stating that it maintains China's Taiping (00966) “superior to the market” rating, with a target price of HK$11.5. The company announced its 2023 interim report results, with net profit of HK$5.22 billion, +20.5% year over year; Taiping Life NBV3.65 billion, +28.5% YoY; NBV Margin 12.2%; Taiping Life EV of HK$254.9 billion, +5% from the beginning of the year; and net assets of HK$82 billion. China Taiping insists on promoting the implementation of a high-quality development strategy and continuing to lay out the construction of a health ecosystem. The bank is optimistic about its long-term development resilience.
The bank mentioned that the net profit of China Taiping's core life insurance business has rebounded, and believes that it is mainly due to the rapid expansion of traditional life insurance premiums. Life insurance: Insurance service performance was HK$7.64 billion, with a margin of contract services of HK$216.7 billion, +1.4% compared with the beginning of the year. Among them, the new life insurance business contributed 9.4% year-on-year to the margin of contract services in the first half of the year. In addition, Taiping Life's new policy premiums were +42.4% year-on-year; of these, individual insurance/banking insurance were +21.8%/82.5%, respectively. In terms of original premiums, individual long-term insurance paid HK$13.4 billion for the first year, or HK$13.4 billion for the first year of banking insurance, +70.6% year-on-year. The growth rate of prepayment premiums through the banking insurance channel was relatively fast, and the share of bank insurance channel premiums was +1.4pct compared to the same period last year. The product structure was adjusted and optimized. Traditional life insurance was +41.7% compared to the same period. The bank expects this to be related to the popularity of traditional life insurance such as increased lifetime life.
In addition, the company's new business performance is still superior to most of its peers: individual insurance channels NBV3 HK$280 million, +22.4% year-on-year; banking insurance channels NBV of HK$460 million, which is basically the same as the same period last year. The individual insurance/banking insurance channel NBVmargin was +1.3pct/-2.4pct to 18.6%/3.6% year over year, respectively. The bank believes that under the company's focus on value growth, it is expected to continue to achieve positive NBV growth in the second half of the year. In terms of insurance agents, the number reached 320,000, -18.1% compared to the beginning of the year. The monthly per capita premium was +32.8% compared to the beginning of the year to 18,000 yuan. The bank believes that the reduction in the number of agents is related to the company's promotion of high-quality development of the business team.