PICC(SH:601319) HTSC·2025-03-28 08:32Investment Rating - The investment rating for the company is upgraded to "Buy" for A-shares and maintained as "Buy" for H-shares [1][8]. Core Views - The company reported a strong growth in life insurance with a 127% year-on-year increase in NBV (New Business Value), driven by improved profit margins despite a slight decline in new premium income [2][16]. - The overall profitability is supported by significant investment performance, with a projected ROE (Return on Equity) of approximately 16.5% for 2024, the highest in nearly a decade [4]. - The property insurance segment experienced a slight increase in the combined ratio, primarily due to natural disaster impacts, but is expected to normalize in 2025 [3][16]. Summary by Sections Life Insurance - The NBV for life insurance increased by 127% year-on-year, with agent and bancassurance channels growing by 86% and 223% respectively [2]. - The profit margin for NBV improved significantly to 18% from 8% due to a reduction in channel costs and adjustments in assumptions [2]. - The company anticipates a 17% growth in NBV for 2025, supported by ongoing improvements in profit margins [2]. Property Insurance - The combined ratio for property insurance rose by 1 percentage point to 98.8%, influenced by natural disasters [3]. - The auto insurance segment maintained a stable combined ratio of 96.8%, while non-auto insurance saw an increase to 101.9% due to rising claims [3]. - A return to normal disaster frequency is expected in 2025, with a projected combined ratio of approximately 98% [3]. Investment Performance - The total investment return rate improved significantly to 5.6% in 2024 from 3.3% in 2023, leading to over 100% growth in investment income [4]. - The company’s net assets increased by 11% year-on-year, indicating good asset-liability matching [4]. - The dividend per share (DPS) for 2024 is set at RMB0.18, up from RMB0.16 in 2023, reflecting a dividend payout ratio of about 19% [4]. Earnings Forecast and Valuation - The EPS (Earnings Per Share) forecast for 2025 is adjusted to RMB0.93, with target prices for A/H shares raised to RMB7.90 and HKD4.70 respectively [5][8]. - The company’s projected gross premium income for 2024 is RMB537.7 billion, with a growth rate of 6.71% compared to 2023 [7][23]. - The forecasted net profit for 2024 is RMB42.15 billion, representing an 88.83% increase year-on-year [7][23].