ZA ONLINE(06060) 交银国际证券·2024-08-29 04:16Investment Rating - The report maintains a "Buy" rating for the company, with a target price adjusted down from HKD 18 to HKD 15, indicating a potential upside of 44.0% from the current price of HKD 10.42 [1][2][8]. Core Insights - The company's profitability has been impacted by a year-on-year decline in underwriting profit, with a reported net profit of RMB 0.55 billion for the first half of 2024, down from RMB 2.2 billion in the same period last year. The underwriting profit decreased by 41%, and total investment income fell by 14% [1][2]. - Premium income grew by 5.4% year-on-year, primarily driven by the digital life and automotive ecosystems, contributing 10.9 and 1.9 percentage points to the growth, respectively. However, health insurance premiums declined by 9.6%, and consumer finance premiums dropped by 21.6% due to external factors and a strategic business contraction [2][5]. - The combined ratio increased to 97.9%, up 2.1 percentage points year-on-year, with significant increases in the consumer finance and health ecosystems. The technology and banking segments showed a notable reduction in net losses, with technology output revenue increasing by 65.5% [2][3]. - Total investment income decreased to RMB 6.2 billion from RMB 7.23 billion year-on-year, with an annualized net investment return rate of 2.3%, remaining stable, while the annualized total investment return rate fell by 0.7 percentage points to 3.3% [2][3]. Financial Summary - The company reported insurance service revenue of RMB 27.535 billion in 2023, with projected growth to RMB 30.912 billion in 2024, reflecting a year-on-year growth rate of 12.3% [3][9]. - Adjusted net profit attributable to shareholders is forecasted to be RMB 283 million in 2024, down from RMB 294 million in 2023, indicating a decline of 3.8% [3][6]. - The price-to-earnings ratio is projected to be 49.5 times in 2024, while the price-to-book ratio is expected to be 0.69 [3][9].