NCI(601336) 国金证券·2025-02-26 08:23Investment 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 Insights - The company is expected to see 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 implemented a new strategic transformation towards professional marketization, aligning its initiatives with other leading insurance companies [2]. - The asset side shows a high elasticity to equity markets, with a projected profit growth contribution of 39% if the equity market rises by 5% [2]. - The company’s 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 insurance firm controlled by the Central Huijin Investment, with a significant shareholding structure [10][11]. - The management team is composed of experienced individuals from the China Investment Corporation and internal promotions [12]. Financial Performance - The company has experienced significant fluctuations in net profit, primarily influenced by the asset side, with a compound annual growth rate of 12.8% from 2012 to 2022 [15]. - The new business value (NBV) has shown a recovery trend, with a projected increase in 2024 due to a low base and strong sales of savings insurance products [17][52]. Liability Side - The company has undergone two major strategic transformations from 2016 to 2022, focusing on health insurance and professional marketization [21]. - The new strategy emphasizes enhancing the productivity of agents, with a target of 10,000 CNY per agent per month by the first half of 2024 [2]. Asset Side - The company has a higher equity allocation compared to peers, with a 17.6% allocation to stocks and funds, which contributes to its high elasticity to market fluctuations [2]. - The net investment yield has been affected by the maturity of non-standard assets and a lower allocation to long-term bonds, leading to a decline in net investment yield [2]. Profit Forecast and Valuation - The forecast for net profit shows a significant increase in 2024, with estimates of 250.4 billion CNY, reflecting a year-on-year growth of 187% [3]. - The company’s internal value is currently trading at a significant discount, with a projected reasonable valuation of 0.89X PEV under a 3.5% investment return assumption for 2025 [3].