Investment Rating - The report maintains a "Buy" rating for the company [7][5]. Core Insights - The company reported a net profit of RMB 15.813 billion for Q3 2025, representing a year-on-year increase of 91.5%, driven by improved underwriting performance and significant investment gains [1]. - The combined operating ratio (COR) for the first three quarters was 96.1%, a decrease of 2.1 percentage points year-on-year, indicating enhanced underwriting profitability [1]. - The total investment income for the first three quarters reached RMB 35.9 billion, a year-on-year increase of 33.0%, with an annualized total investment return of 5.4% [4]. Summary by Sections Underwriting Performance - The company has improved its underwriting management, leading to a decrease in the car insurance COR to 94.8%, down 2.0 percentage points year-on-year, and a 65% increase in underwriting profit to RMB 11.729 billion [2]. - Non-car insurance COR decreased to 98.0%, down 2.5 percentage points year-on-year, with underwriting profit turning positive at RMB 3.136 billion [3]. Investment Performance - The investment performance saw a significant increase, with Q3 2025 investment income reaching RMB 15.041 billion, up 60.2% year-on-year [4]. - The company has increased its allocation to high-quality equity assets, with equity assets accounting for 13.8% of the portfolio as of the first half of 2025 [4]. Profit Forecast and Valuation - The earnings per share (EPS) estimates for 2025, 2026, and 2027 have been raised to RMB 2.09, RMB 2.32, and RMB 2.52 respectively, reflecting adjustments of +8.1%, +8.4%, and +8.7% [5]. - The target price based on discounted cash flow (DCF) valuation has been increased to HKD 23.20 from HKD 21.00 [5].

Investment Rating - The report maintains a "Buy" rating for the company with a target price of HKD 16.00 [8][9] Core Insights - The company reported a significant improvement in underwriting performance, with a net profit of RMB 11.312 billion in Q1 2025, representing a year-on-year increase of 92.7% [1] - The combined operating ratio (COR) improved to 94.5%, a decrease of 3.4 percentage points year-on-year, primarily due to fewer natural disasters in the first quarter [2] - Total investment yield increased by 0.4 percentage points year-on-year to 1.2%, driven by better equity investment performance [1][4] Summary by Sections Underwriting Performance - The company experienced a substantial improvement in underwriting performance, with COR decreasing to 94.5% and underwriting profit increasing by 183.0% to RMB 6.653 billion [2] - The company is expected to maintain a leading position in the industry, with projected COR for 2025 at 97.1% [2] Premium Growth - Insurance service revenue grew by 6.1% year-on-year in Q1 2025, driven mainly by non-auto insurance [3] - Auto insurance revenue showed modest growth of 2.8%, while non-auto insurance revenue increased by 11.7% [3] Investment Income - Total investment yield for Q1 2025 was 1.2%, a year-on-year increase of 56% in total investment income [4] - The company’s net assets increased by 4.7% quarter-on-quarter due to rising profits [4] Earnings Forecast and Valuation - The earnings per share (EPS) forecast for 2025 has been raised to RMB 1.81, with target prices based on discounted cash flow (DCF) valuation remaining unchanged at HKD 16.00 [5]