CHINA TAIPING(HK:00966) Guotai Junan Securities·2024-03-25 16:00Investment Rating - The report maintains a "Buy" rating for China Taiping (0966) and lowers the target price to HKD 9.61 per share, corresponding to a 2023 P/EV of 0.16 times [3][4]. Core Views - The company's net profit attributable to shareholders for 2023 increased by 44.1%, primarily due to improved investment income. The NBV (New Business Value) met expectations, and the industry is benefiting from cyclical channel optimization, which supports stable performance [3][4]. - The report highlights a significant improvement in comprehensive investment returns, with a notable increase in the total investment return rate by 2.66 percentage points year-on-year [3][11]. Financial Summary - The 2023 net profit reached HKD 6,190 million, up 44.1% year-on-year, driven by substantial investment income improvements [8][11]. - The NBV for 2023 increased by 26.0% (before adjustments) and 0.7% (after adjustments), indicating a strong performance in the savings insurance product strategy [3][11]. - The company’s dividend for 2023 was HKD 0.3 per share, a 15.4% increase year-on-year, with a dividend payout ratio reduced from 33.4% in 2022 to 17.4% in 2023 [3][11]. Business Performance - The individual insurance NBV increased by 7.2% year-on-year, driven by new business growth that meets residents' savings needs, with new individual insurance policies up by 5.3% [3][11]. - The company experienced a significant decline in the number of individual insurance agents, down 40.0% year-on-year to 235,000, while the productivity per agent improved by 30.6% [3][11]. - The property and casualty insurance segment saw a slow growth rate, with total premium income up by 1.4% year-on-year, while the comprehensive cost ratio increased by 1.2 percentage points to 98.4% [3][11]. Investment Strategy - The report suggests that the ongoing strong demand for insurance savings products and a recovering equity market could act as catalysts for future performance [3][11].