Jinwu Financial News | CMB International said that the first quarter results of Ping An of China (02318) showed the growth resilience of its main business segments in life insurance, financial insurance and banking. The value of the new life insurance and health insurance business increased 20.7% year over year to $12.89 billion under a comparable scale, exceeding market expectations and better than the bank's forecast of achieving medium double digit year-on-year growth.
According to the bank, the company's stock price is currently at 0.47 times FY24EP/EV and 0.71 times FY24E net market ratio. The steady rise in stock prices in the future will be co-catalyzed by factors such as: 1) a recovery in market sentiment; 2) a steady recovery in asset-side investment returns; and 3) a continued drop in credit risk exposure involving housing. Considering the current decline in long-term interest rates to < 2.5%, leading to a decline in interest income from newly allocated fixed income assets, as well as factors such as equity market fluctuations affecting securities trading price spread earnings, the bank lowered the FY24-26E three-year earnings forecast per share to 6.42/7.05/7.61 yuan, compared with the original earnings forecast of 6.94/7.87/8.62 yuan per share. Maintaining a “buy” rating, the target price is HK$52.0, corresponding to FY24E 0.47 times P/EV and 0.71 times the net market ratio.