Group 1 - A new private equity fund named Suzhou Kuanyu Equity Investment Fund Partnership (Limited Partnership) has been established with a capital contribution of approximately 22.43 billion yuan [1] - The fund's business scope includes private equity investment, investment management, and asset management activities [1] - The fund is co-funded by Tencent-related companies, including Shenzhen Xiaoshu Commercial Management Co., Ltd., Tencent Technology (Shanghai) Co., Ltd., and Sunshine Life Insurance Co., Ltd. under Sunshine Insurance (06963.HK) [1]

Investment Rating - The investment rating for the company is "Buy" and it is maintained [6][14]. Core Views - The company reported a total premium income of 80.81 billion yuan for the first half of 2025, representing a year-on-year increase of 5.7%. The insurance service income was 32.44 billion yuan, up 3.0% year-on-year, and the net profit attributable to shareholders was 3.39 billion yuan, reflecting a 7.8% increase year-on-year. The report expresses optimism about the company's future investment value due to its commitment to value development and the expected steady growth of dividends per share (DPS) [4][12][14]. Summary by Sections Financial Performance - In the first half of 2025, the company achieved a net profit of 3.39 billion yuan, up 7.8% year-on-year, driven by both asset and liability sides. The total investment income reached 10.7 billion yuan, a year-on-year increase of 28.5%. The annualized net, total, and comprehensive investment returns were 3.8%, 4.0%, and 5.1%, respectively [12][13]. Business Segments - The life insurance segment, Sunshine Life, reported a new business value (NBV) of 4.01 billion yuan, with a year-on-year increase of 47.3%, primarily due to an improvement in NBV margin, which rose by 7.2 percentage points to 21.1%. The new single premium decreased by 3.0% to 19.01 billion yuan [12][13]. - Sunshine Property Insurance achieved original premium income of 25.27 billion yuan, up 2.5% year-on-year, with a combined ratio (COR) of 98.8%, improving by 0.3 percentage points. The underwriting profit increased by 42.4% to 290 million yuan [12][13]. Future Projections - The company expects insurance service income for 2025 to be 67.95 billion yuan, with a year-on-year growth rate of 6.2%. The net profit attributable to shareholders is projected to be 5.89 billion yuan, reflecting an 8.2% year-on-year increase [14][15].

Core Viewpoint - Sunshine Insurance reported a year-on-year increase of 7.8% in net profit attributable to shareholders for the first half of 2025, reaching 3.39 billion yuan, with life insurance and property insurance net profits growing by 5.6% and 2.6% respectively [1][2] Group 1: Performance Summary - The net business value (NBV) of life insurance increased by 47.3% year-on-year to 4.01 billion yuan, with individual insurance and bank insurance channels growing by 23.5% and 53% respectively [1] - The comprehensive cost ratio (CoR) for property insurance improved by 0.3 percentage points to 98.8%, with claims and expense ratios showing mixed trends [2] - Sunshine Insurance's total insurance premium income rose by 2.5% year-on-year to 25.27 billion yuan, with a notable increase in non-auto insurance premiums [2] Group 2: Investment and Valuation - The internal value of Sunshine Group grew by 11.0% to 128.49 billion yuan, while net assets decreased by 10.1% to 55.84 billion yuan due to the impact of interest rate declines [2] - The company is currently trading at 0.38x and 0.33x P/EV for 2025 and 2026 estimates, with a target price of 4.60 HKD and a potential upside of 2.7% [2]

Core Insights - Sunshine Insurance reported a net profit of 3.4 billion yuan for H1 2025, representing a year-on-year increase of 7.8% [1] - The company's new business value (NBV) reached 4.01 billion yuan, showing a significant year-on-year growth of 47.3% [1] - The embedded value (EV) stood at 128.5 billion yuan, up 11% from the beginning of the year [1] Life Insurance Segment - The NBV from the bancassurance channel saw substantial growth, with a year-on-year increase of 53% [1] - New single premium income for H1 2025 was 19 billion yuan, down 3% year-on-year [1] - The average monthly workforce was 50,000, a decrease of 3.6% from the beginning of the year [1] Property Insurance Segment - Sunshine Property Insurance's original premium income was 25.3 billion yuan, reflecting a year-on-year increase of 2.5% [2] - The underwriting profit for H1 2025 was 290 million yuan, up 42.4% year-on-year [2] - The combined cost ratio improved to 98.8%, a decrease of 0.3 percentage points year-on-year [2] Investment Strategy - Total investment assets reached 591.9 billion yuan, an increase of 7.9% from the beginning of the year [2] - The annualized net investment yield was 3.8%, down 0.2 percentage points year-on-year [2] - The company is reallocating its investment strategy by increasing core equity and reducing bond holdings [2] Profit Forecast and Investment Rating - The profit forecast for 2025-2027 has been adjusted to 6 billion, 6.3 billion, and 6.5 billion yuan respectively [3] - The current market valuation corresponds to a 2025E price-to-book (PB) ratio of 0.73x and a price-to-embedded value (PEV) of 0.35x, indicating a low valuation [3] - The company is expected to benefit from the implementation of its "New Sunshine Strategy" in the life insurance sector [3]

Core Viewpoint - The report from CICC maintains the target price for Sunshine Insurance (06963) at HKD 4.60, with a rating of outperforming the industry, reflecting a potential upside of 2.7% based on the 2025-2026 P/EV ratios of 0.40x and 0.34x respectively [1] Group 1: Life Insurance Performance - Sunshine Life's new business value (NBV) increased by 47.3% year-on-year to CNY 4.01 billion in 1H25, with individual insurance and bank insurance channels growing by 23.5% and 53% respectively [2] - The contract service margin (CSM) balance for life insurance reached CNY 56.08 billion, a 10.3% increase from the end of the previous year, indicating a positive trend in product structure optimization [2] Group 2: Property Insurance Performance - Sunshine Property's original insurance premium grew by 2.5% year-on-year to CNY 25.27 billion in 1H25, with non-auto insurance premiums increasing by 12.5% and accounting for 50.6% of total premiums [3] - The combined ratio (CoR) improved by 0.3 percentage points to 98.8%, with the loss ratio and expense ratio changing by +2.5 percentage points and -2.8 percentage points respectively [3] Group 3: Investment Performance - The net and total investment returns for Sunshine were 3.8% and 4.0% respectively in 1H25, showing stable performance despite a high base effect from bond investments in 1H24 [4] - The company increased its stock allocation by 1.8 percentage points compared to the end of the previous year, while also adding long-duration interest rate bonds to optimize the duration structure and cost-return matching [4] Group 4: Group Value Growth - The intrinsic value of Sunshine Group reached CNY 128.49 billion in 1H25, an 11.0% increase from the end of the previous year, with net assets amounting to CNY 55.84 billion [5]

Core Viewpoint - The report from CICC maintains the profit forecast for Sunshine Insurance for 2025-2026, with a target price of HKD 4.60, indicating a potential upside of 2.7% based on the current trading multiples of 0.38x/0.33x P/EV for 2025e and 2026e [1] Group 1: Life Insurance Performance - Sunshine Life's new business value (NBV) increased by 47.3% year-on-year to CNY 4.01 billion in 1H25, with individual insurance and bank insurance channels growing by 23.5% and 53% respectively [2] - The contract service margin (CSM) balance for Sunshine Life reached CNY 56.08 billion, reflecting a 10.3% increase from the end of the previous year [2] - The product structure has improved significantly, with over 50% of individual insurance channel products being floating income and protection-type products [2] Group 2: Property Insurance Performance - Sunshine Property's original insurance premium grew by 2.5% year-on-year to CNY 25.27 billion in 1H25, with non-auto insurance premiums increasing by 12.5% [3] - The combined ratio (CoR) improved by 0.3 percentage points to 98.8%, with the loss ratio and expense ratio changing by +2.5 percentage points and -2.8 percentage points respectively [3] - The combined ratio for auto insurance decreased by 1.6 percentage points to 98.1%, with the proportion of household vehicle premiums increasing by 3 percentage points [3] Group 3: Investment Performance - The net and total investment yields for Sunshine were 3.8% and 4.0% respectively in 1H25, showing stable performance despite a high base effect from bond investments in 1H24 [4] - The asset allocation saw an increase in stock proportion by 1.8 percentage points compared to the end of the previous year, along with an increase in long-duration interest rate bonds to optimize the duration structure and cost-revenue matching [4] Group 4: Group Value Growth - The intrinsic value of Sunshine Group reached CNY 128.49 billion in 1H25, marking an 11.0% increase from the end of the previous year [5] - The net assets amounted to CNY 55.84 billion, primarily due to the use of a 60-day moving average of government bond yield curves for discounting traditional insurance reserves [5]

Core Insights - Sunshine Insurance reported a stable performance for the first half of the year, with total premium income reaching 80.81 billion yuan, an increase of 5.7% [2] - The company achieved a net profit attributable to shareholders of 3.39 billion yuan, growing by 7.8% [2] - Total investment income for the first half amounted to 10.7 billion yuan, reflecting a significant growth of 28.5% [2] Insurance Business Performance - Sunshine Life, a subsidiary of Sunshine Insurance, generated total premium income of 55.44 billion yuan, marking a year-on-year increase of 7.1% [2] - The new business value for Sunshine Life was 4.01 billion yuan, with a comparable year-on-year growth of 47.3% [2] - Sunshine Property & Casualty Insurance reported original insurance premium income of 25.27 billion yuan, up by 2.5% year-on-year [2] Financial Position - Sunshine Insurance's total assets surpassed 600 billion yuan for the first time, reaching 625.56 billion yuan as of June 30 [2] - The equity attributable to shareholders decreased by 10.1% compared to the end of the previous year, amounting to 55.84 billion yuan [2] - The fluctuation in net assets is a challenge faced by multiple insurance companies following the new accounting standards [2] Investment Performance - As of June 30, the total investment asset scale of Sunshine Insurance was 591.86 billion yuan, with total investment income of 10.7 billion yuan, reflecting a year-on-year growth of 28.5% [2] - Investment income reported in the profit statement was 6.35 billion yuan, an increase of 42.3%, primarily due to higher dividend income and trading gains from investment assets [2]

Core Insights - Sunshine Insurance reported a stable performance for the first half of the year, with total premium income reaching 80.81 billion yuan, an increase of 5.7% [1] - The company achieved a net profit attributable to shareholders of 3.39 billion yuan, growing by 7.8% [1] - Total investment income for the first half amounted to 10.7 billion yuan, reflecting a significant growth of 28.5% [1] Insurance Business Performance - Sunshine Life, a subsidiary of Sunshine Insurance, generated total premium income of 55.44 billion yuan, up 7.1% year-on-year [1] - The new business value for Sunshine Life was 4.01 billion yuan, with a comparable year-on-year increase of 47.3% [1] - Sunshine Property & Casualty Insurance reported original insurance premium income of 25.27 billion yuan, marking a 2.5% increase [1] Financial Position - Sunshine Insurance's total assets surpassed 600 billion yuan for the first time, reaching 625.56 billion yuan as of June 30 [1] - Shareholder equity attributable to the parent company was 55.84 billion yuan, down 10.1% from the end of the previous year [1] - The fluctuation in net assets is a challenge faced by multiple insurance companies following the new accounting standards [1] Investment Business Performance - As of June 30, the total investment asset scale of Sunshine Insurance was 591.86 billion yuan, with total investment income of 10.7 billion yuan, up 28.5% year-on-year [1] - Investment income reported in the profit statement was 6.35 billion yuan, reflecting a year-on-year increase of 42.3%, primarily due to increased dividend income and trading gains from investment assets [1]

Investment Rating - The report maintains an "Overweight" rating for the non-bank financial sector [1] Core Insights - The non-bank financial sector is expected to continue experiencing high growth in performance, supported by a strengthening market [1] - The insurance sector's investment balance has surpassed 36 trillion yuan, with a continued increase in stock allocation [24][25] - The securities sector has seen a significant increase in trading volume, with various reforms being implemented by the Hong Kong Stock Exchange [18][22] - The multi-financial sector is transitioning into a stable growth phase, with trust assets continuing to grow despite a decline in profits [30][34] Summary by Sections 1. Recent Performance of Non-Bank Financial Sub-Sectors - In the recent five trading days (August 18-22, 2025), only the multi-financial sector outperformed the CSI 300 index, rising by 6.40% [8] - Year-to-date, the multi-financial sector has increased by 17.78%, followed closely by the insurance sector at 17.68% [9] 2. Insights on Non-Bank Financial Sub-Sectors 2.1 Securities - Trading volume has significantly increased, with an average daily trading amount of 23,820 billion yuan in August, up 245.13% year-on-year [18] - The margin trading balance reached 21,468 billion yuan, a year-on-year increase of 52.31% [18] - The average PB valuation for the securities industry is projected at 1.4x for 2025E, with recommendations for leading firms like CITIC Securities and Tonghuashun [22] 2.2 Insurance - The insurance sector's investment balance reached 36.23 trillion yuan, with an 8.9% increase since the beginning of the year [24] - The proportion of bonds in the investment portfolio has risen to 51.9%, while stocks account for 8.8% [24] - The insurance industry is characterized by a strong cyclical nature, with expectations for improved performance as the economy recovers [28] 2.3 Multi-Financial - The trust industry saw its asset scale grow to 29.56 trillion yuan, but profits declined significantly by 45.5% [30] - The futures market experienced a trading volume of 1.059 billion contracts in July, with a transaction value of 71.31 trillion yuan, reflecting a year-on-year growth of 48.89% [35] - The report suggests that innovative risk management services will be a key growth area for the futures industry [38] 3. Industry Ranking and Key Company Recommendations - The recommended ranking for the non-bank financial sector is insurance > securities > other multi-financial [44] - Key companies recommended include China Ping An, New China Life, China Pacific Insurance, CITIC Securities, Tonghuashun, and Jiufang Zhitu Holdings [44]

Investment Rating - The report maintains a positive investment rating for the non-bank financial sector, highlighting the potential for continued market recovery and growth in both the insurance and securities segments [4][42]. Core Insights - The report emphasizes the sustainable performance of the non-bank sector, particularly in insurance, where Sunshine Insurance reported a total premium income of 80.81 billion yuan, a year-on-year increase of 5.7%, and a new business value of 4.01 billion yuan, up 47.3% year-on-year [1]. - The revised classification management measures for securities companies aim to enhance their service to the real economy, focusing on high-quality development and supporting differentiated growth for small and medium-sized firms [2][3]. - The report suggests that the combination of proactive fiscal policies and moderately loose monetary policies is expected to boost market sentiment and investment returns, particularly in the insurance sector [4][42]. Summary by Sections Market Review - The broad market indices saw significant increases, with the Shanghai Composite Index rising by 3.49% and the Shenzhen Component Index by 4.57% during the week [8]. - The non-bank financial sector also experienced a positive trend, with the multi-financial index increasing by 4.18% [8]. Securities Sector - The report details that the total trading volume in the A-share market reached 14.98 trillion yuan, with a daily average trading amount of 2.50 trillion yuan, reflecting a 23.84% increase week-on-week [16]. - The IPO underwriting scale for the year reached 59.244 billion yuan, while refinancing underwriting amounted to 821.754 billion yuan [16]. Insurance Sector - Sunshine Insurance's total premium income for the first half of 2025 was reported at 80.81 billion yuan, with a net profit of 3.39 billion yuan, marking a 7.8% increase year-on-year [1]. - The report highlights a shift in the insurance sector towards higher new business value and improved liability quality, with the internal value reaching 128.49 billion yuan, an 11% increase from the previous year [1]. Investment Recommendations - The report recommends focusing on key insurance companies such as Sunshine Insurance, China Pacific Insurance, and China Life, as well as top securities firms like CITIC Securities and Huatai Securities [4][43]. - The anticipated benefits from the revised classification evaluation system for securities firms are expected to favor leading firms and those with distinctive equity business lines [4][42].