中国太保(601601)2022年报点评:改革初见成效 负债端持续向好

China Taibao (601601) 2022 report review: Reforms are beginning to bear fruit, and the debt side continues to improve

太平洋證券 ·  04/02  · Researches

Incident: China Taibao recently released its 2022 annual report. The company achieved total revenue of 455.372 billion yuan, an increase of 3.3% over the previous year; Guimu's operating profit of 40.115 billion yuan, an increase of 13.5% over the previous year; Guimu's net profit of 24.609 billion yuan, a decrease of 8.3% over the previous year; and the weighted ROE was 10.8%, down 1.4 pct from 2021.

Banking insurance channels have grown significantly, helping life insurance NBV achieve a reversal. China Taibao's life insurance sector achieved business revenue of 225.343 billion yuan in 2022, an increase of 6.5% over the previous year; the sector's overall new business value ratio was 11.6%, down 11.9 pct from the previous year, but the new business value ratio in the second half of the year increased 13.5% year-on-year. Compared with the performance of peers, the overall growth rate of new life insurance business value had already reached an inflection point in early 2022, showing an overall improvement trend.

Looking at segmented channels, the agent channel achieved revenue of 176.524 billion yuan, a year-on-year decrease of 6.4%, accounting for 78% of total sector revenue, and still contributed to the sector's main performance; group insurance and other channels contributed steadily, achieving business revenue of 15.269 billion yuan and 3,072 billion yuan respectively;

The banking insurance channel achieved revenue of 30.478 billion yuan, a sharp increase of 308.7% over the previous year. Of this, new insurance revenue was 28.809 billion yuan, a sharp increase of 332.0% over the previous year. The new business value of the banking insurance channel increased 174.9% year on year, and the share of new business value increased 7.0 percentage points over the previous year. We believe that the sharp increase in the contribution of banking insurance channels stemmed from the strategic transformation of the company's multi-channel layout, which focused on core regions and other factors. Among them, the revenue from insurance business in the top ten regions increased 6.7% year-on-year from 135.14 billion yuan in 2021 to 144.184 billion yuan in 2022.

The “Changhang Plan” reform lays the foundation for the reversal of life insurance NBV. In 2022, the company continued to promote the transformation and implementation of the “Changhang Plan”, the quality of its business continued to improve, and the agent team continued to be optimized in the direction of “professionalization”, “specialization” and “digitalization”, with significant improvements. Among them, the average monthly performance rate of agents increased 11.3 pct to 63.4% year on year; the average monthly first-year insurance business income was 6,844 yuan, an increase of 47.6% over the previous year. With the support of professionalization, specialization, and digital optimization of the team, the centralization of the agent team structure improved significantly. The average number of insurance marketers in 2022 was 279,000, compared to 525,000 in the same period last year. Although the team structure changed significantly, the quality of the life insurance business was slightly optimized. Among them, the 13-month policy continuation rate of personal life insurance customers increased 7.7 pct to 88% over the same period last year. Overall, the results of the company's “Changhang Plan” agent career marketing reform are obvious. The per capita productivity of the team has been greatly increased, which can offset the loss of the absolute number of agents, and is expected to continue to increase the value contribution of new businesses and provide a solid foundation for the sector's NBV reversal.

The advantages of refined management are gradually showing, and the overall industrial insurance business is stable, moderate and improving. Taibao Insurance achieved business revenue of 170.377 billion yuan, an increase of 11.6% over the previous year, and net profit of 8.285 billion yuan, an increase of 30.4% over the previous year. The comprehensive cost ratio was 97.3%, a year-on-year decrease of 1.7 pct. Among the main types of insurance, auto insurance contributed 97.992 billion yuan in business revenue and achieved underwriting profit of 2,836 billion yuan. The comprehensive cost ratio decreased by 1.8 pct to 96.9% compared to 2021. The main source of increase was the promotion of new energy vehicle marketing models and the deepening of fine management, which led to a premium growth rate of more than 90% for new energy vehicles. As the penetration of new energy vehicles continues to deepen, Taibao's new marketing model for new energy vehicles is expected to continue to lead the industry, and vehicle insurance will continue to contribute to performance growth in the overall business. In terms of other insurance types, revenue from liability insurance, health insurance, agricultural insurance, and guarantee insurance businesses all maintained year-on-year growth, with +37.08%, +20.03%, +32.71%, and 6.31% respectively. The comprehensive cost ratio was 99.8%/101.6%/97.7%/95.5% respectively. As one of the insurers that guaranteed the comprehensive cost ratio of the insurance business remained stable, the intelligent risk control 5.0 system upgraded in 2022 was the main reason. Under the premise of improving digital operation capabilities and controllable risks, the guarantee insurance business was ensured Stable development.

The scale of asset management has been growing steadily, and earnings performance has shown resilience. By the end of 2022, the company's total asset management scale reached 2.72 trillion yuan, an increase of 4.7% over the previous year, the return on total investment was 4.2%, a year-on-year decrease of 1.5pct, the net investment return was 4.3%, and the year-on-year decrease was 0.2pct. Among them, the total return on investment was affected by the decline in securities trading income, and there was a significant decline. By the end of 2022, fixed income investors accounted for 73.9% of Taibao's portfolio, and equity investors such as securities and bonds accounted for 22%. Influenced by factors such as the continued decline in long-term interest rates and sharp fluctuations in the equity market over the past year, Taibao reduced the risk of reinvestment by extending the term of fixed income assets for a long period of time, achieved relatively stable investment performance, demonstrating the resilience of its investment portfolio to risk and performance resilience. Looking ahead to 2023, as China's economy enters a period of resumed growth, interest rate levels are expected to pick up, equity market sentiment picks up, and risks in the real estate industry are gradually mitigated, and Taibao's return on investment is expected to improve year-on-year.

In summary, we expect the 2023-25 EPS to be 3.13/3.70/4.03 yuan respectively. Corresponding to the 2023 PE will be 8.55x, which will be upgraded to a “buy” rating.

Risk warning: Life insurance reform fell short of expectations, company management changed, and agent team structure optimization fell short of expectations.

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