Huachuang Securities·2024-04-24 14:02Investment Rating - The report maintains a "Strong Buy" rating for the company, with a target price of 56.6 CNY [2][9]. Core Insights - The company's new business value (NBV) increased by 20.7% year-on-year to 12.9 billion CNY in Q1 2024, driven by improved pricing strategies and cost optimization [2][3]. - The annualized net investment return rate for Q1 2024 was 3.0%, a slight decrease of 0.1 percentage points year-on-year, while the comprehensive investment return rate reached 3.1% [2][3]. - The company is actively enhancing its product offerings in wealth management, elderly care, and insurance to meet diverse customer needs, which is expected to support the growth of new business value [3][9]. Summary by Sections Financial Performance - In Q1 2024, the company achieved a net operating profit of 38.7 billion CNY, a year-on-year decrease of 3.0%, while the net profit was 36.7 billion CNY, down 4.3% year-on-year [2][3]. - The life and health insurance segments reported a new business value of 12.9 billion CNY, with a new business value margin of 22.8%, up 6.5 percentage points year-on-year [2][3]. Sales Channels - The personal life insurance sales agent count was 333,000, a decrease of 4.0% from the beginning of the year, but the quality of the sales force improved significantly, with a 56.4% year-on-year increase in per capita NBV [3][9]. - The company is expanding its community-based sales channels, with over 10,000 sales personnel and a continued increase in customer retention rates [3][9]. Investment Strategy - The company’s investment portfolio exceeded 4.93 trillion CNY, with a focus on reducing non-standard exposure, which now stands at 404.8 billion CNY, accounting for 8.2% of total investment assets [3][9]. - The report highlights a strategic shift towards optimizing product and channel costs, which is expected to enhance profitability and reduce reliance on interest rate spreads [3][9].