20181028-招商证券_香港_-中国太保-02601.HK-3Q18_net_profit_up_17.4__YoY,_Maintain_BUY_5页_556kb

报告摘要

CPIC (2601 HK) Summary

Core Content

China Pacific Insurance Company (CPIC), listed as 2601 HK, reported a 3Q18 net profit increase of 17.4% YoY, with total comprehensive income rising 23.3% YoY. The report highlights the company's performance across different segments and provides insights into its valuation, management strategies, and investment ratings.

Key Financial Highlights (3Q18)

Shareholders' net profit: RMB12.7bn (up 17.4% YoY)
Total comprehensive income: RMB12.7bn (up 23.3% YoY)
ROE (not annualized): 9.0%
Net investment yield: 4.8%
Total investment yield: 4.7%

Segment Performance

Life Insurance Segment:
- Agency-channel regular FYP: Down 18.8% YoY in 3Q18, compared to a 22.8% decline in 1H18.
- Expected NBV growth: The report anticipates recovery in NBV growth for the life segment in 2H18, especially due to a low base effect in 2H17.
P&C Insurance Segment:
- Automobile premium growth: Slowed to 8.0% YoY in 3Q18 from 10.1% in 1H18.
- Non-auto premium growth: Strong at 30.8% YoY in 3Q18.

Management Guidance

Transition from agent headcount growth to productivity improvement, with a focus on technology capabilities.
Emphasis on risk protection and long-term savings products.
Aim for more balanced NBV growth across quarters.

Valuation and Financial Forecasts

CPIC currently trades at:

~0.7x 2018E P/EV
~1.5x 2018E P/B

The report maintains a BUY rating, with the following key reasons:

Expected improvement in life NBV growth in 2H18 due to stabilized performance and low base effect in 2H17.
Attractive valuation in the long-term view, given its position at the lower end of historical P/EV and P/B ranges.

Financial Projections (Year ended 31 Dec)

Metric	2016	2017	2018E	2019E	2020E
Total Revenues (RMB mn)	266,081	319,405	372,422	431,928	493,670
Shareholders' Net Profit (RMB mn)	12,057	14,662	19,676	23,317	27,378
EPS (RMB)	1.33	1.62	2.17	2.57	3.02
BVPS (RMB)	14.54	15.17	17.34	19.92	22.94
P/E (x)	19.0	15.6	11.6	9.8	8.4
P/B (x)	1.7	1.7	1.5	1.3	1.1
P/EV (x)	0.9	0.8	0.7	0.6	0.5
ROE (%)	9.1	10.9	13.4	13.8	14.1

Peer Comparison (HK Peers)

Company	Ticker	Rating	Price (HK$)	TP (HK$)	Mkt Cap (USD m)	P/EV (2018E)	P/E (2018E)	P/B (2018E)	ROE (2018E)
China Life	2628 HK	Buy	15.96	32.9	82,696	0.5	9.0	1.1	12.5%
Ping An	2318 HK	Buy	74.40	109.0	172,893	1.2	12.0	2.2	19.4%
China Pacific	2601 HK	Buy	29.70	54.6	43,008	0.7	11.6	1.5	13.4%
New China Life	1336 HK	Buy	37.45	51.2	19,487	0.6	13.0	1.4	11.3%
China Taiping	966 HK	NR	25.95	n.a.	11,895	n.a.	9.8	1.3	13.3%
PICC Group	1339 HK	NR	3.32	n.a.	17,964	n.a.	7.1	0.8	11.6%
China Re	1508 HK	NR	1.40	n.a.	7,526	n.a.	8.9	0.7	7.5%

Investment Ratings

Industry Rating: OVERWEIGHT (Expect sector to outperform the market over the next 12 months)
Company Rating: BUY (Expect stock to generate 10%+ return over the next 12 months)

Key Catalysts and Risks

Key Catalyst: Better-than-expected NBV growth in 2H18.
Key Risks: Adverse capital market conditions, lower-than-expected NBV growth.

Price Performance (as of 26 Oct 2018)

Metric	1m	6m	12m
2601 HK	2.8%	-11.6%	-17.8%
HSI	-11.1%	-17.6%	-12.4%

Shareholding Structure

Fortune Investment Co.: 14.17%
Shenergy Group: 13.52%
No. of shares outstanding (mn): 9,062
Free float (mn): 2,775

Conclusion

CPIC's 3Q18 results show in-line net profit and good total investment yield, with the life segment's NBV growth expected to recover in 2H18. Despite a decline in the agency-channel regular FYP, the company is maintaining a BUY rating due to improving life insurance performance and attractive valuation. The report highlights management's shift towards productivity and technology, and the potential for NBV growth as key drivers for future performance.

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