NCI(601336) 国金证券·2025-02-26 08:56Investment Rating - The report gives a "Buy" rating for the company, with target prices of 66.51 CNY for A-shares and 43.95 HKD for H-shares, based on a valuation of 0.72X PEV for A-shares and 0.44X PEV for H-shares [3]. Core Views - The company is expected to experience significant profit growth in Q1 2025 due to a rebound in the stock market and a low base effect, alongside strong performance in the "opening red" period [1]. - The company has a high equity elasticity compared to peers, with a projected profit growth contribution of 39% from a 5% increase in the equity market [2]. - The new business value is forecasted to grow significantly, with projections of 64.8 billion CNY, 68.5 billion CNY, and 74.0 billion CNY for 2024, 2025, and 2026 respectively, indicating a year-on-year growth of 114%, 6%, and 8% [3]. Summary by Sections Company Overview - The company is a state-owned life insurance firm controlled by the Central Huijin Investment Ltd, with a significant shareholding of 32.25% [10]. - The management team is primarily composed of individuals from the China Investment Corporation and internal promotions, indicating a strong leadership background [12]. Liability Side - The company is undergoing a strategic transformation towards professionalization and marketization, aligning its initiatives with leading insurance firms [2]. - The introduction of a new "basic law" emphasizes individual performance and aims to enhance productivity, with a target of 10,000 CNY monthly per agent by H1 2024 [2]. Asset Side - The company has a higher equity allocation compared to its peers, with a stock and fund allocation of 17.6% as of H1 2024, compared to 10.8% for Ping An and 11.6% for China Pacific [2]. - The equity leverage ratio is notably high at 2.89, indicating sensitivity to market fluctuations [2]. Profit Forecast and Valuation - The forecast for net profit shows a significant increase to 250.4 billion CNY in 2024, followed by 169.4 billion CNY in 2025 and 203.1 billion CNY in 2026, with year-on-year growth rates of 187%, -32%, and 20% respectively [3]. - The company’s embedded value is currently trading at a significant discount, suggesting potential upside in valuation [3]. Shareholder Returns - The company maintains a dividend payout ratio above 30%, with expectations for steady growth in dividends as profits recover [19].