“价”改善驱动NBV 高增，续期业务贡献主要保费增速。2024H1 阳光人寿实现保费收入517.6 亿元，同比+12.9%；新单保费同比-9.0%，续期保费同比+32.3%；实现新业务价值37.5 亿，同比+39.9%，NBV 增速主要驱动在于新业务价值率的提升，预计主要来源于预定利率下调与报行合一带来成本改善。从险种结构看，2024H1 传统险与分红险增速亮眼，占比分别同比+0.7pct 至72.5%/+0.9pct 至15.5%，万能险维持占比0.2%，健康险/意外险分别同比-1.4pct至11.4%/-0.2pct 至0.5%。Matters:
With 2024H1, the company achieved net profit of 3.14 billion yuan, +8.6% year over year; Sunshine Life achieved a new business value of 3.75 billion, +39.9% year over year; Sunshine Financial Insurance's COR was 99.1%, +0.9 pct year over year. As of 2024H1, the included value was 112.64 billion, +8.2% compared to the end of the previous year. 2024H1 achieved net/total/comprehensive return on investment of 3.8%/3.6%/7.2%, +0.4pct/+0.1pct/+2.3pct, year-on-year, respectively.
Commentary:
Improved “price” is driving a high increase in NBV, and the renewal business contributed to the main premium growth rate. 2024H1 Sunshine Life achieved premium income of 51.76 billion yuan, +12.9%; new insurance premiums -9.0% year-on-year, renewal premiums +32.3%; achieved new business value of 3.75 billion, +39.9% year-on-year. The NBV growth rate was mainly driven by an increase in the value ratio of new businesses, which is expected to be mainly due to cost improvements brought about by lower predetermined interest rates and integration of reporting and banking. Looking at the insurance type structure, 2024H1 traditional insurance and dividend insurance have impressive growth rates, accounting for +0.7 pct to 72.5%/+0.9 pct to 15.5% year on year, universal insurance maintained 0.2%, and health insurance/accident insurance respectively -1.4 pct to 11.4% /-0.2 pct to 0.5% year on year.
The integration of reporting and banking affects the short-term performance of the banking insurance sales side, and agent reforms drive individual insurance channels to contribute to the growth rate of major new orders. Looking at the channel structure, banking insurance channels are still used as the main source of premiums. The banking insurance channel was +9.5% to 34.013 billion yuan, accounting for a small percentage of -2.0pct to 65.7%, mainly due to the short-term negative impact of reporting and bank integration on the sales side, and -16.9% of new banking insurance policies compared to the same period last year. Individual insurance channels were +25.5% YoY to 13.685 billion yuan, accounting for +2.7pct to 26.4% YoY, with new orders +15.7% YoY. New insurance orders are mainly driven by the improvement in the quality and efficiency of the agency team. Although the average monthly manpower ratio was -5.5% to 5,2,316 people, the average monthly activity rate was +1.7 pct to 20.6% year over year, and per capita production capacity was +9.4% to 0.028 million yuan.
The overall quantity and quality of non-auto insurance has risen sharply, and eHealth Insurance has contributed the main underwriting profit. 2024H1 Sunshine Financial Insurance achieved the original premium of 24.65 billion yuan, +12.4% year over year; the overall COR was 99.1%, +0.9 pct year over year, which is expected to be mainly due to the increase in the frequency of natural disasters in the first half of the year. Among them, the cost rate was -0.5 pct to 32.7% year over year, and the compensation rate was +1.4 pct to 66.4% year over year. 1) In terms of car insurance, the original 2024H1 premium was +3.2% to 13.29 billion yuan, and COR non-restated +1.4pct to 99.7% year over year. The share of family car premiums was +1.5pct compared to the same period. This is expected to bring improvements on the pay-side, but this is offset by the negative effects caused by the increased frequency of natural disasters. 2) In terms of non-car insurance, overall premiums were +25.5% to 11.36 billion yuan, and COR non-restatement was 0.2 pct to 98.5% year over year. eHealth Insurance contributed the main underwriting profit, with premiums +41.4% to 4.34 billion yuan, of which the original premium for policy health insurance was +109.0%, and the overall COR of eHealth Insurance was 92.8%. Liability insurance +32.8% YoY to 2.14 billion yuan, COR -0.3pct YoY to 102.7%. Guaranteed insurance was +5.0% to 1.83 billion yuan, with a COR of 99.8%.
Freight insurance was +13.0% to 1.28 billion yuan year-on-year, but due to natural disasters compounded by the increase in the frequency of road freight traffic accidents, COR was +0.9 pct to 105.6% year over year.
The investment side as a whole picked up, and structurally, bonds and stocks all increased their holdings. As of 2024H1, the Group's total investment assets reached 514.11 billion, +7.2% compared to the end of the previous year. 2024H1, the company achieved net/total/comprehensive return on investment of 3.8%/3.6%/7.2%, +0.4pct/+0.1pct/+2.3pct year-on-year, respectively. In terms of allocation structure, the fixed income category was +1.3pct to 70.5% compared to the end of the previous year, of which bonds were +2.4pct to 54.4% compared to the end of the previous year, and non-standard -1.0pct to 14.2% compared to the end of the previous year; the equity category was +1.9pct to 23.0% compared to the end of the previous year, with stocks and funds +2.3pct to 14.3%. Judging from the accounting measurement method, FVTPL/FVOCI accounted for 26.4%/63.7% of investment assets, respectively, and OCI assets were +2.7 pct compared to the end of the previous year.
Investment suggestions: 2024H1 Sunshine Life achieved a high NBV increase. The core driver was the reduction in the scheduled interest rate and the improvement in the value ratio of the new business brought about by the integration of reporting and banking; the overall prosperity of Sunshine Financial Insurance increased, and COR is expected to be pressured by natural disasters, but the non-auto insurance sector showed both volume and price improvements; the investment side showed an overall recovery in terms of volume and price. We maintain the 2024-2026 EPS forecast value of 0.42/0.51/0.61, maintain the 2024 personal insurance business 0.35xPb, property insurance business 0.5xPb, and other business 0.5xPb. Considering the assumption that the NBV growth rate slightly exceeds expectations, and the positive contribution of the difference in return on investment, the target price for 2024 is HK$4.85 per share (HKD/RMB 0.91). Maintain a “Recommended” rating.
Risk warning: regulatory changes, reforms falling short of expectations, equity market fluctuations, continuing decline in interest rates
