Jingu Finance News | Citi International issued research reports, stating that China Life Insurance (02628) achieved a 3Q net income attributable to the mother of 66.2 billion yuan, a year-on-year increase of +17.67 times, driving the 9M24 net income attributable to the mother to increase by 173.9% to 104.5 billion yuan, within the previously announced target price range (165%-185%) at the median, meeting market expectations. The 3Q net income attributable to the mother performed well, mainly benefiting from the warming equity market driving a substantial increase in fair value changes in profit and loss.

In terms of new business value, the 9M24 new business value (comparable caliber) increased by +25.1% year-on-year, higher than the 1H24 growth rate of 18.6%, indicating a rapid growth in 3Q24 NBV. With the downward adjustment of pricing interest rates, the implementation of the 'separation of sales and underwriting' in the individual insurance channel, and the optimization of policy term structure, the bank expects the 3Q24 new business value rate to further increase; coupled with the rapid growth of new single premiums under the expected interest rate adjustment, the bank expects the 3Q NBV year-on-year growth rate to exceed 40%. Looking to the fourth quarter, the bank believes that the company's new business value rate will continue to expand, with a slight slowdown in the growth rate of new single premiums. The full-year NBV is expected to achieve steady growth, with FY24E NBV expected to grow by 17%.

The bank believes that the good performance of investment income in FY24 will further drive the company's net assets and intrinsic value to increase. They have raised FY24-26 EPS profit forecast to 4.45/2.58/2.61 yuan, and raised the target price to 20.0 Hong Kong dollars (previous value: 15.5 Hong Kong dollars), corresponding to 0.41x FY24 P/EV (previous value: 0.3x) and 0.91x FY24E P/BV (previous value: 0.81x), maintaining a 'buy' rating.