Ping An of China (601318): Investment income drives net profit growth slightly higher than expected NBV growth of 5%
Investment Highlights: Event: The company releases its 2019 third quarter report.
Realized operating profit attributable to mothers 1,040.
61 ppm, an increase of 21 in ten years.
5% (3Q19 single quarter growth of 16%); net profit attributable to mothers 1,295.
670,000 yuan, an increase of 63 in ten years.
2% (3Q19 single quarter growth of 50%).
Life and health insurance business 深圳桑拿网NBV grew 4.
5%, operating profit growth in line with expectations, the company adjusted the scale of NBV growth rate never decreased by 7.
3% to 5%.
Life insurance and health insurance businesses traded for price, and NBV is expected to grow by 5%.
9M19, Ping An NBV previously increased by 4.
5% (in the third quarter of 19 single quarter growth of 4.
1%), of which NBV FYP increased by -7% year-on-year (in the third quarter of 19, it increased by -2.
0%), the new business value margin is 48.
1%, up 5 per year.
The company expects the annual NBV growth target to be 5%.
On the whole, the increase in the value rate benefits from: 1.
The product structure is optimized, and the proportion of short-sending and economical services decreases; 2.
In the third quarter of 19th, the company upgraded its main products “Ping An Fu” and “Score” series, and developed a new product “Fu Xing” focusing on the critical illness market. The value rate remained high. The growth of new orders was weak.
The number of agents at the end of the period was 124.
50,000 people, a decrease of 12 from the beginning of the year.
1%, a decrease of 3 from the earlier period.
2%, the team retention rate and capacity indicators fell; 2.
2. The company pursues excellent development and implements the strategy of weakening the beginning of the door, the agent needs time to adjust; 3.
The life insurance company estimates that the structure will be adjusted. The company will split the one and two business groups into five major sales areas: east, west, south, north, and central, and build five large-scale centers.
Looking forward to the future, the company will continue to adhere to the “quality human development” strategy, through technology empowerment, continue to promote the transformation and upgrading of agent channels, at the same time focus on high-value businesses, improve the “product +” service system, the company will focus on promoting the talented person planIt currently accounts for 10%, and the production capacity is 1 of ordinary agents.
We expect the increase in troop production capacity to be the core driving force for future NBV growth.
The recovery in investment income included a reduction in the effective tax rate to 22.
7%, property insurance operating profit increased by 75.
At 9M19, Ping An Property and Casualty Insurance, non-car and health insurance had their original premiums increased by 6.
2% and 37.
9%.Property insurance achieved operating profit of 142.
54 ppm, an increase of 75 in ten years.
5% (among which pre-tax profit increased by 28.
9%, net profit increased by 98.
4%), benefiting from new diabetes regulations and industry regulation, after excluding dialysis one-time effects in 2018 (18.
$ 5.6 billion, the company’s effective tax rate for the first three quarters was 43.
2% decreased to 22.
7%; comprehensive cost rate of 96.
2% (decade +0.
), The quality of business remains good, and continuous and continuous industry.
The higher-than-expected investment income drove rapid growth in net profit.
The size of the insurance investment portfolio reached 3.
03 trillion yuan, an earlier growth of 8.
9M19 annualized return on investment 4.
9% (4 in the same period last year.
7%); annualized total investment yield 6.
0% (4 in the same period last year).
In 9M19, the company’s non-banking business interest income + investment income + fair value gains / losses for the first three quarters / single third quarter quarterly growth rates were 63.
0% and 29.
2%, driving rapid growth in net profit.
Investment suggestion: raise earnings forecast, EPS is expected to be 8 in 19-21.
91 and 10.
32 yuan (previous forecast was 8.
76 and 10.
27 yuan), the previous growth rate was 42.
1% and 15.
8%, ROE is 25.
7% and 23.
2%, budget operating profit is 7 respectively.
78 and 10.
18 yuan (previous forecast was 7).
73 and 10.
13 yuan), higher than the growth rate of 18 respectively.
6% and 16.
0%, the current sustainable corresponding operating profit multiple is 12.
2 and 8.
8x, maintain “Buy” rating.
Risk Warning: The equity market fluctuates sharply, long-term interest rates have fallen unilaterally, and the sales of guaranteed products have fallen short of expectations