The Zhitong Finance App learned that Guotai Junan released a research report to maintain China's Taiping (00966) “gain” rating, with a target price of HK$9.61. The 2024-2026 EPS forecast was raised to HK$1.90 (previous value 1.49, +27.6%)/2.20 (previous value 1.91, +15.2%) /2.62 (previous value 2.24, +17.1%).

Guotai Junan said that NBV is in line with expectations, and channel optimization in the industry is beneficial to stable performance: NBV was 26.0% (before HKD calibration assumption adjustment)/0.7% (after HKD calibration assumption adjustment) in '23. Product strategies centered on savings insurance led to high interest rate sensitivity. By the end of '23, traditional life insurance and annuity insurance accounted for 57.5% of the company's original premium income. Individual insurance NBV was 7.2% year-on-year under the same caliber, mainly due to meeting residents' savings needs, resulting in a year-on-year increase of 5.3% of new individual insurance policies. It is worth mentioning that the company's manpower scale declined significantly in '23. As of the end of '23, the number of personal insurance agents dropped sharply by 40.0% year on year to 235,000; while the production capacity of each agent increased significantly by 30.6%. The value ratio of individual insurance increased slightly by 0.3 pt to 25.2%. It is expected to increase the lifetime impact of increases to reduce short-term savings. Banking Insurance NBV was 217.2% year over year under the same caliber, and both new orders and value ratios increased significantly. Among them, new bank insurance policies were 45.3% year over year; the bank insurance value ratio was +6.3pt to 11.9% year over year, which is expected to be mainly driven by an increase in long-term payment periods.

Financial insurance grew slowly, and the comprehensive return on investment improved markedly: total domestic financial insurance premium income was +1.4% year over year, of which car insurance premiums were -2.0% year over year. The growth was slower than the industry expected to maintain profit levels in order to actively slow down business expansion, and the comprehensive financial insurance cost ratio was +1.2pt to 98.4%. The company's investment side performance improved markedly in '23, with a net return on investment of 3.56%, -0.30pt year on year, which is expected to be mainly affected by long-term equity investment losses; the total return on investment was 2.66%, +1.45pt year over year, and equity investment trading contributions increased in '23, but fluctuations in the equity market still put pressure on the total return on investment; the return on comprehensive investment was 5.01%, +2.66% year over year, which is expected to contribute mainly to the profit improvement of the high-dividend strategy.