华泰证券表示，寿险产品利润率改善推升NBV增长。利润率提升来源于定价利率下调以及报行合一带来的费用压降，对于降低利差损风险至关重要，在寿险定价利率持续下调的背景下， 寿险NBV利润率有望持续改善，估计2024年全年寿险NBV增长70%。HTSC predicts that China Taiping's life insurance NBV will grow by 70% in the full year of 2024, and the full year ROE could reach 10.5%.
According to the report released by HTSC, due to the improved profitability of China Taiping, the EPS for 2024-2026 has been adjusted to 2.19/2.06/2.30 Hong Kong dollars (previously 1.81/1.73/1.88), and the target price has been raised from 10 Hong Kong dollars to 12 Hong Kong dollars, maintaining a "buy" rating. HTSC predicts that China Taiping's life insurance NBV will grow by 70% in the full year of 2024, and the full year ROE could reach 10.5%.
China Taiping announced on August 27th that the 1H24 performance showed an EPS of 1.54 Hong Kong dollars, a 13% year-on-year increase.
HTSC states that the improvement in the profit margin of life insurance products will boost NBV growth. The improvement in profit margin comes from the downward adjustment of pricing interest rates and cost reduction from the integration of reporting and banking, which is crucial for reducing interest spread risk. With the continuous downward adjustment of life insurance pricing interest rates, the life insurance NBV profit margin is expected to continue to improve, estimating a 70% growth in life insurance NBV for the full year of 2024.
Regarding property insurance, the overall underwriting performance has improved. It is expected that the mainland property/casualty insurance/overseas property/casualty insurance/reinsurance COR in 2024 will be 98%/88.2%/95.8%.
The report also points out that China Taiping has a robust solvency. The comprehensive solvency ratio for life insurance business was 278% in 1H24 (2023: 284%), and the comprehensive solvency ratio for mainland property/casualty insurance business was 229% (2023: 216%).
