Investment Rating - The report maintains an "Accumulate" rating for China Life Insurance [7][14]. Core Views - The company is expected to see a significant increase in net profit attributable to shareholders for the first three quarters of 2025, projected to grow by 50%-70% year-on-year, primarily driven by substantial improvements in investment income and insurance service performance [2][14]. - The report highlights the positive impact of the recovering equity market, which has exceeded expectations, contributing to the company's improved profitability [4][14]. Financial Summary - **Revenue Forecasts**: - 2023A: 405,040 million - 2024A: 528,567 million - 2025E: 665,291 million (26% increase from 2024A) - 2026E: 657,033 million (1% decrease from 2025E) - 2027E: 728,939 million (11% increase from 2026E) [5][15] - **Net Profit (Attributable to Shareholders)**: - 2023A: 51,184 million - 2024A: 106,935 million (109% increase from 2023A) - 2025E: 181,868 million (70% increase from 2024A) - 2026E: 192,657 million (6% increase from 2025E) - 2027E: 212,462 million (10% increase from 2026E) [5][15] - **Earnings Per Share (EPS)**: - 2023A: 1.81 - 2024A: 3.78 - 2025E: 6.43 - 2026E: 6.82 - 2027E: 7.52 [5][15] - **Return on Equity (ROE)**: - 2023A: 11% - 2024A: 21% - 2025E: 30% - 2026E: 27% - 2027E: 26% [5][15] Investment Drivers - The report emphasizes the strong growth in new business value (NBV), expected to increase by 30.7% year-on-year for the first three quarters of 2025, benefiting from proactive sales strategies before the adjustment of the "831" interest rate [14]. - The company has significantly increased its allocation to equity investments, with core equity assets reaching 969.123 billion, a 35.7% increase from the first half of 2024, which is expected to enhance investment returns [14][15].

Core Viewpoint - China Life Insurance is expected to see a significant increase in net profit attributable to shareholders for the first three quarters of 2025, with a year-on-year growth of 50%-70%, driven primarily by substantial investment income and improved insurance service performance [1][2]. Investment Highlights - The company maintains a "Buy" rating with a target price of 50.42 yuan, and a projected P/EV of 0.9x for 2025. The estimated net profit attributable to shareholders for the first three quarters is projected to be between 156.785 billion and 177.689 billion yuan, reflecting a notable increase compared to the 6.9% profit growth in the first half of 2025 [2]. - The estimated net profit for the third quarter alone is expected to be between 115.854 billion and 136.758 billion yuan, indicating a year-on-year growth of 75%-106%. This growth is attributed to a significant rise in investment income and improvements in insurance service performance [2]. Investment Income Growth - The substantial increase in investment income is anticipated to result from a recovery in the stock market and an optimized asset allocation strategy that favors equity assets. As of September 2025, the CSI 300 index has risen by 17.9% year-to-date, compared to 17.1% in the same period last year, while the Shanghai Composite Index has increased by 15.8% year-to-date [3]. - The company has actively promoted the entry of long-term funds into the market, enhancing equity investment efforts. The core equity assets (stocks and funds, excluding money market funds) reached 969.123 billion yuan in the first half of 2025, representing a growth of 35.7% year-on-year [3]. Insurance Service Performance - The company is expected to see strong growth in new business value (NBV), with a projected year-on-year increase of 30.7% for the first three quarters of 2025, reflecting an acceleration from the growth rate in the first half of 2025. This is attributed to proactive new policy sales before the adjustment of the "831" interest rate [4]. - Additionally, the rise in the ten-year government bond yield by 20 basis points year-to-date, along with strict cost control measures, is expected to further enhance the performance of insurance services [4]. Catalysts - An unexpected improvement in the equity market is identified as a potential catalyst for further growth [5].