Ping An of China (601318) 2019 Interim Report Review: Value Growth Slightly Exceeds Expected Daily Operational Performance Growth Stable

Ping An of China (601318) 2019 Interim Report Review: Value Growth Slightly Exceeds Expected Daily Operational Performance Growth Stable

Event: Ping An announced its 2019 interim results.

In the first half of the year, net profit attributable to mothers was 9.77 million yuan, +68 a year.

1%, the mother’s operating profit of 7.35 million yuan, +23 throughout the year.

8%; new business value is 4.11 million yuan, +4 for the whole year.

7%; as of the first half of the year, net assets attributable to mothers were 6,253 trillion, an increase of 12 earlier.

4%; the embedded value of the group was US $ 111.3 billion, an increase of 11% earlier.

Annualized total / net investment income replaces 5.

5% / 4.

5%, rising by 1 every year.

5pct / 0.

5pct; preliminary quantitative index is 0.

75 yuan a year + 21%.

Comment: Life and health insurance business: The insurance structure has been further optimized, the value rate has been continuously improved, and the growth of NBV is in line with expectations.

In the context of changes in the external environment, Ping An actively adjusted its business structure and product strategy. Although the new single premium in the first half of the year continued the negative growth trend of last year, its new business value achieved a slight increase, only +4.

7%, the growth rate is more in line with expectations.

The first is to optimize the structure of insurance types and increase the potential of new business value rate.

Property insurance business: Affected by the macro-environment and the growth rate of business adjustment, the supervision tended to be severe and decreased, and the compensation rate increased, and the underwriting profit increased negatively.

In the first half of the year, the market share of property insurance business decreased compared to the beginning. In the first half of the year, in order to monitor the increase in the first half of the year, leading companies took compulsory measures to restrict business development in some regions.In the speed range, the growth rate of non-auto insurance short- and medium-term accidents and health insurance is still high. The growth rates of other insurance premiums affected by the adjustment of the insurance business have reversed and dropped from the previous year;Negative growth.

The high profit growth is mainly affected by non-daily factors. Unless the daily factors are eliminated and the growth rate is stable, the income from interest margins will decline.

In the first half of the year, the growth rate of Ping An’s insurance business surged, basically as follows: First, the expansion of Q1’s equity market contributed to the increased profitability of the total investment rate of return; second, in May this year, the financial department issued a pre-tax replacement of fees and commission expenses.The new policy highlights thickening profits.

Attributable operating profit has grown rapidly, and the structure of profit sources has remained relatively stable. Among them, the growth rate and proportion of interest income contribution contributed to a significant decline. Therefore, in response to the capital market fluctuations in 2018, the company actively reduced the level of interest margin.
The embedded value growth of life insurance business slightly exceeded expectations, and the return on embedded value operating profit was stable.

The embedded value of life insurance business in the first half of the year was 7,132 trillion, an increase of 16 earlier.

3%, slightly more than expected.

The factors affecting the impediment to the growth of embedded value are still investment income and consequence factors (one-off items that are not part of daily operating income), and the transfer of contributions is increasing at a positive rate.

Excluding daily operational factors and short-term changes in investment, the return on operating profit from embedded value in the life insurance business is reset.

2%, the growth rate is relatively stable, with an annualized growth rate of 28.

4%, which is an improvement from the last 31% growth rate last year. The reason is that the same as the remaining marginal growth rate is the goal of new business value growth.

Investment advice: After excluding daily factors and short-term investment changes, Ping An will still be able to realize operating profit in the first half of the year, and its embedded value will grow steadily. It has a first-mover advantage and a forward-looking vision in both debt- and asset-side businesses.

We expect 淡水桑拿网 China Ping An’s BPS to be 32 in 2019-2011.



59, EPS is 8.




The possible embedded value of Ping An of China in the next 3 years is expected to be 65, 76 and 89 yuan, with a target price of 104 yuan in 2019, corresponding to a PEV of 1.

6 times, maintaining the “strong push” level. Risk reminder: New business growth pressures increase, equity markets fluctuate, and long and short interest rates continue to fall.