Guotai Junan Securities·2024-10-17 09:38Investment Rating - The report maintains a "Buy" rating for China Life Insurance, with an updated target price of 60.71 CNY per share, corresponding to a 2024 P/EV of 1.10 times [3][5]. Core Views - The company's net profit attributable to shareholders for the first three quarters of 2024 is expected to increase significantly, estimated between 101.135 billion CNY and 108.767 billion CNY, representing a year-on-year growth of 165% to 185% [5]. - The substantial profit increase is primarily attributed to improved investment income from equity assets and a low base effect from the previous year [5]. - The report highlights that the recovery of the capital market in Q3 2024 has significantly boosted investment returns, with the Shanghai Composite Index rising by 12.2% year-to-date [5]. - The company is expected to benefit from a favorable market environment, with a focus on optimizing its equity investment structure [5]. Summary by Sections Financial Performance - The report projects a significant increase in net profit for 2024, with EPS estimates raised to 3.98 CNY for 2024, 4.60 CNY for 2025, and 5.29 CNY for 2026, reflecting growth rates of 100.9%, 91.7%, and 88.8% respectively [5][11]. - The company's total revenue for 2024 is forecasted at 445.527 billion CNY, a 29% increase from 2023 [11]. Market Conditions - The report notes that the capital market's recovery has led to a substantial increase in investment income, with the company taking advantage of market opportunities for cross-cycle allocation [5]. - The report emphasizes the strong demand for insurance savings products, which is expected to drive new business value (NBV) growth [5]. Valuation Metrics - The report assigns a P/EV of 1.1 times based on the expected improvement in investment returns and overall company performance [5]. - The current market price is noted at 42.75 CNY, with a target price set at 60.71 CNY, indicating a potential upside [3][5].