HTSC·2025-06-03 04:20Group 1 - The report highlights that the scheduled interest rate cut is expected to improve the cost structure of life insurance products, potentially enhancing sales momentum in the second half of the year [1][3][46] - The current valuation of insurance stocks is at historical lows, with A-share PEV ranging from 0.51x to 1.03x and H-share PEV from 0.22x to 1.15x, indicating a favorable entry point for investors [4][36] - The liquidity in the market is improving, driven by the expectation of RMB appreciation and public fund reforms, which is beneficial for insurance stock valuations [2][15][26] Group 2 - The scheduled interest rate cut is anticipated to lower the predetermined interest rate for traditional insurance from 2.5% to 2.0%, which will help alleviate the cost-revenue mismatch faced by life insurance products [3][48][56] - The dynamic adjustment mechanism for predetermined interest rates will allow for quarterly updates based on market interest rates, which is expected to enhance the overall performance of the life insurance sector [62][63] - The report emphasizes the importance of asset-liability matching to mitigate interest rate risk, with companies like China Pacific Insurance and Ping An having relatively better matching levels [5][60] Group 3 - The report notes that the sales performance of the agent channel has been under pressure due to the cost-revenue mismatch, but the expected interest rate cut may improve sales dynamics [58][60][61] - The insurance sector has seen a year-to-date increase in new premium income, primarily driven by the bancassurance channel, indicating a potential recovery in sales [58][61] - The report suggests that the public fund reforms may lead to increased liquidity in the A-share market, which could further support insurance stock valuations [43][44] Group 4 - The report identifies key companies to watch, including China Pacific Insurance, Ping An, AIA Group, and China Life, all of which are expected to benefit from the anticipated changes in the market [10][37][38] - The overall market sentiment has improved following the easing of tariff tensions, which has positively impacted the performance of insurance stocks in both A and H-share markets [22][35][36] - The report indicates that the insurance sector's performance is closely tied to macroeconomic factors, including interest rates and currency fluctuations, which will continue to influence valuations [36][29][30]