Investment Rating - The report maintains a "Buy" rating for the company [10][17]. Core Insights - The company exhibits strong characteristics in NBV growth, stable performance, and improved interest spread [17]. - The projected net profit for the company is expected to reach 5.73 billion RMB in 2025, with a year-on-year growth of 5.9% [17]. Summary by Sections 1. Profit Growth and Dividend Yield - The company shows robust profit growth, with a projected net profit of 5.45 billion RMB in 2024, reflecting a year-on-year increase of 45.8% [4][9]. - The dividend payout ratio is expected to reach 40.1% in 2024, ranking first among listed insurance companies, with a dividend yield of 5.4% [4][28]. 2. NBV Growth and Silver Insurance Channel - The company has demonstrated strong resilience and growth in NBV, with a year-on-year increase of 44.2% in 2023 and 43.3% in 2024 [5][32]. - The silver insurance channel has become a significant contributor, accounting for over 60% of the total NBV, benefiting from the "reporting and operation integration" strategy [5][50]. 3. Liability Cost Optimization - The company has seen a significant decline in liability costs, with the NBV to effective business value ratio at 12.79%, ranking third among listed insurance companies [6][77]. - The net investment yield and the NBV/effective business value yield have improved, with a year-on-year increase of 100 basis points and 31 basis points, respectively [6][77]. 4. Stability of Performance - The company maintains a stable performance with balanced contributions from both asset and liability sides, with insurance service performance reaching 53.83 billion RMB in 2024 [4][22]. - The CSM (Contractual Service Margin) has shown steady growth, with a year-on-year increase of 12.6% to 509 billion RMB by the end of 2024 [7][34]. 5. Profit Forecast and Valuation - The forecasted net profit for 2025-2027 is expected to be 5.77 billion RMB, 6.06 billion RMB, and 6.79 billion RMB, respectively, with growth rates of 5.9%, 7.2%, and 10.6% [9][17]. - The company's value is estimated at 573 billion RMB, with a target price of 5.35 HKD per share [17][9].

【环球网财经综合报道】华泰证券近日发布的研究报告聚焦寿险公司盈利驱动因素，深入分析了合同服务边际（CSM）对寿险企业盈利能力的影响。报告 显示，CSM作为寿险合同负债的重要组成部分，代表尚未实现的预期利润。其年度释放构成了保险服务业绩的重要部分，与投资业绩共同决定寿险公司年 度盈利表现。 根据华泰研报， 2023年会计准则切换至2025年上半年的两年半期间，主要上市保险公司CSM增长呈现显著分化，但行业整体CSM规模略有下降。这一现象 在保费增速反弹的背景下尤为突出，CSM增长乏力直接影响了保险服务业绩表现，导致上市公司合计保险服务业绩同期承压。值得注意的是，2024年以来 投资业绩表现亮眼，最终显著提升了行业净利润水平。报告预计，随着新业务增长推动，中资上市保险公司合计CSM将在2025-2027年间恢复每年约2%的增 长，有望扭转当前下滑趋势。 从CSM规模看，中国人寿和中国平安保持行业领先地位，而中国人民保险和阳光保险虽然规模较小但增速较快。报告显示，IFRS 17准则下的保险合同负债 主要由未来现金流现值、非金融风险调整和CSM构成。1H25期间，中资上市保险公司CSM占准备金比例介于12%-15%之 ...

人民财讯9月19日电，华泰证券研报称，合同服务边际(CSM)是寿险合同负债的组成部分，代表尚未实 现的预期利润，可被视作是利润的蓄水池。CSM每年的释放是保险服务业绩的重要组成部分，保险服 务业绩代表从事保险业务赚取的利润，可被视作是寿险的承保利润，与投资业绩一起构成当年盈利的主 要部分。2023年切换新会计准则至2025年上半年这两年半中，主要上市保险公司CSM增长差异较大， 但合计CSM略降，在保费增速反弹的背景下较为突兀。CSM增长乏力对保险服务业绩造成影响，上市 公司合计保险服务业绩同期亦有所承压。2024年以来投资业绩表现出色，最终使净利润增色不少。受新 业务增长推动，华泰证券预计中资上市公司合计CSM在2025—2027每年增长2%左右，有望扭转下滑趋 势。 ...

人民财讯9月19日电，华泰证券研报称，合同服务边际(CSM)是寿险合同负债的组成部分，代表尚未实 现的预期利润，可被视作是利润的蓄水池。CSM每年的释放是保险服务业绩的重要组成部分，保险服 务业绩代表从事保险业务赚取的利润，可被视作是寿险的承保利润，与投资业绩一起构成当年盈利的主 要部分。2023年切换新会计准则至2025年上半年这两年半中，主要上市保险公司CSM增长差异较大， 但合计CSM略降，在保费增速反弹的背景下较为突兀。CSM增长乏力对保险服务业绩造成影响，上市 公司合计保险服务业绩同期亦有所承压。2024年以来投资业绩表现出色，最终使净利润增色不少。受新 业务增长推动，华泰证券预计中资上市公司合计CSM在2025—2027每年增长2%左右，有望扭转下滑趋 势。 ...

Summary of Key Points from the Conference Call Industry Overview - The conference call discusses the insurance industry in China, particularly focusing on the performance of various insurance companies in the first half of 2025 and the impact of new accounting standards on financial reporting [1][4][31]. Core Insights and Arguments - **Profitability Divergence**: The profitability of insurance companies has shown divergence, with some companies like PICC and China Life experiencing a decline in net profit growth, while Ping An and Taiping have either narrowed their losses or returned to profitability [1][3]. - **Impact of New Accounting Standards**: The new accounting standards require fair value measurement of assets and liabilities, significantly affecting profit and loss statements, especially for participating and universal life insurance products [4][8]. - **Net Asset Value Concerns**: There are instances where profit growth does not correspond with net asset growth due to losses in other comprehensive income (OCI) exceeding net profit [5][6]. - **Return on Equity (ROE) Variability**: ROE has generally rebounded in the first half of 2025, but there is significant variability among companies, suggesting a need to focus on net asset growth rates [7][10]. - **New Business Value (NBV) Growth**: The overall NBV growth for life insurance companies was positive, with some companies showing growth even after adjusting for assumptions [2][14][17]. - **Dividend Policies**: Most listed Chinese insurance companies maintained their mid-year dividend policies, with significant growth in mid-year dividends compared to net profit growth [2][11][12][13]. Important but Overlooked Content - **Asset Allocation Changes**: There has been a noticeable increase in equity asset allocation, while fixed income allocation has decreased, although the scale of fixed income investments continues to grow [26][29]. - **Quality Indicators Improvement**: The quality indicators of insurance contracts have shown continuous improvement, reflecting positive changes on the liability side [18]. - **Agent Income Decline**: Some agents have experienced a significant decline in income, attributed to new business pressures and high base effects from the previous year [21]. - **Market Sentiment and Future Opportunities**: Despite recent weak performance in the insurance sector, there are long-term improvement trends in fundamentals, such as reduced liability costs and improved scale trends, which could present future investment opportunities [33][34]. Conclusion The conference call highlights the complexities and challenges faced by the Chinese insurance industry in 2025, emphasizing the need for careful analysis of financial metrics and market conditions to identify potential investment opportunities and risks.

Core Viewpoint - China Life's (02628) performance in the first half of the year is generally in line with expectations, with a net profit increase of 6.9% year-on-year, although there was a 31.2% decline in the second quarter, which was slightly better than expected [1] Financial Performance - The pre-tax profit decreased by 11.5% year-on-year, which aligns with expectations [1] - The new business value (NBV) on a comparable basis increased by 20.3%, while the actual disclosed NBV fell by 11.5% [1] - The comparable NBV for the next insurance segment rose by 9.5%, indicating better performance than anticipated [1] Business Strategy - The company is actively promoting the transformation towards dividend insurance, with over 50% of the first-year premium income from individual insurance coming from dividend insurance as of the end of June [1] Contractual Service Margin (CSM) - The CSM increased by 1.6% to 754.7 billion RMB from the beginning of the year, primarily driven by new business inflows and interest rate changes [1] - However, the new business CSM decreased by 31% year-on-year to 26.2 billion RMB, attributed to the impact of spot interest rate assessments under the Variable Fee Approach (VFA) and declining interest rates [1] Target Price Adjustment - The target price for H-shares has been raised by 24.1% to 24.33 HKD, considering the improvement in liquidity in the Hong Kong stock market, which may help narrow the company's discount [1]

Investment Rating - The report maintains an "Overweight" rating for the insurance sector [2]. Core Insights - The P/EV valuation system is facing challenges in a persistently low interest rate environment, leading to significant adjustments in risk discount rates and investment return assumptions, which have resulted in a decline in NBV and EV growth [5][9]. - The introduction of the PCE-ROCE valuation system aims to provide a more comprehensive reflection of the true value of insurance companies by incorporating comprehensive equity (CE) and return on comprehensive equity (ROCE) [31][43]. - The report identifies that A-share listed insurance companies, particularly China Pacific Insurance and China Life Insurance, are relatively undervalued according to the PCE-ROCE valuation system [5][29]. Summary by Sections 1. Introduction - The P/EV valuation system shows signs of "failure" as the valuation levels for A-share listed insurance companies continue to decline, with significant pressure on new business value growth due to macroeconomic factors [9][14]. 2. PCE-ROCE Valuation System Proposal - The PCE-ROCE system introduces comprehensive equity (CE) and ROCE to better reflect the value of insurance companies under new accounting standards [31][43]. - The system aims to address the limitations of the P/EV system by providing a more stable and predictable valuation framework [5][31]. 3. Comparison of Valuation Systems - The PCE-ROCE system is more effective in reflecting the true value of insurance companies in a low interest rate environment compared to the traditional P/EV system [5][31]. - The report highlights that the P/CE ratio provides a better fit and reflects the comprehensive value of insurance companies compared to P/B and P/EV ratios [5][31]. 4. Analysis of Insurance Companies' Policy Profitability - The report establishes a profitability evaluation system for listed insurance companies based on CSM and NBCSM, identifying key performance indicators to assess profitability [5][31]. - The scoring system ranks companies based on their CSM performance, with AIA, PICC, and CPIC scoring the highest [5][31]. 5. Main Conclusions and Investment Recommendations - The report concludes that several A-share and H-share listed insurance companies are undervalued, suggesting a focus on companies like New China Life, Ping An, AIA, China Life, CPIC, and PICC for potential investment opportunities [5][29].

Investment Rating - The report initiates coverage on Sunshine Insurance with a "Reduce" rating, setting a target price of HKD 2.10 by December 2025 [1][2]. Core Insights - The Chinese insurance industry is on a strong growth trajectory driven by economic expansion and increased insurance awareness. Sunshine Insurance, one of the few companies with a comprehensive license (both life and property insurance), has seen slow market share growth over the past decade, with 2024 market shares at 1.9% for life insurance and 2.8% for property insurance, compared to 1.3% and 2.8% in 2014 [1][9]. - The visibility of the company's performance is high due to the attractive growth prospects of its Contractual Service Margin (CSM), indicating a stable profit outlook. However, the company requires time to expand its business scale and establish a leading position in the industry, comparable to peers like Ping An and China Pacific Insurance [1][9]. Summary by Sections CSM Growth and Profitability - CSM growth is expected to be robust, with a projected increase of 8% in 2025, 9% in 2026, and 11% in 2027, driven by a recovery in new life insurance sales and an increase in agent productivity [4][14]. - The CSM balance for Sunshine Life was reported at a year-on-year growth of 13% in 2024, benefiting from a smaller historical policy scale compared to peers [4][15]. Investment Risks - The company has a high equity asset exposure, with a net asset ratio of 1.1 times, which poses significant profit volatility risks in a fluctuating stock market. A 10% drop in the Shanghai Composite Index could lead to a 32% decline in profits [4][20]. - The distribution channel is heavily reliant on bancassurance, contributing 56% of new business value in 2024, which may hinder market share growth and new business value expansion [4][24]. Valuation and Target Price - The target price of HKD 2.10 is based on a valuation of 4x expected 2025 P/E for life insurance, 3x for property insurance, and 0.3x P/B for other businesses, reflecting a total expected P/E of 5x [4][46]. - The valuation multiples are close to historical lows, with the industry average P/E ranging from 4x to 9x in recent years [4][46]. Company Overview - Sunshine Insurance was founded in May 2004 and is one of the seven major insurance groups in China, listed on the Hong Kong Stock Exchange in December 2022 [51][52]. - The company primarily operates through Sunshine Life for life insurance and Sunshine Property for property insurance, with life insurance being the main profit source [54].