Investment Rating - The report maintains a "Buy" rating for China Life Insurance [2][7] Core Views - The insurance service performance is under pressure, leading to a temporary decline in profit growth. In 1H25, the company achieved a net profit attributable to shareholders of 40.931 billion yuan, a year-on-year increase of 6.9%, but the growth rate decreased by 32.6 percentage points compared to 1Q25. The net profit for 2Q25 was 12.129 billion yuan, down 31.2% year-on-year, primarily due to high base effects from bond investments and losses from long-term interest rate declines [5] - New business value (NBV) has returned to positive growth, with NBV growth exceeding expectations. In 1H25, NBV increased by 20.3% year-on-year to 28.546 billion yuan, surpassing the expected growth of 10.9%. The new single premium also saw a slight increase of 0.6% year-on-year to 161.255 billion yuan [6] - The company's total investment assets have surpassed 7 trillion yuan, with a significant increase in the proportion of FVOCI stocks. As of June 30, the total investment assets reached 7.13 trillion yuan, a year-on-year increase of 7.8% [6] Financial Data and Profit Forecast - The company is projected to have operating revenue of 486.723 billion yuan in 2025, with a year-on-year growth rate of -7.92%. The net profit attributable to shareholders is expected to be 114.290 billion yuan, reflecting a year-on-year growth of 6.88% [8][10] - The price-to-earnings (P/E) ratio for 2025 is estimated at 10.30, while the price-to-embedded value (P/EV) ratio is projected to be 0.77 [8][10]

Investment Rating - The report maintains a "Buy-A" investment rating for the company [6] Core Views - The company reported a net profit attributable to shareholders of 27 billion yuan in Q1 2025, a year-on-year decrease of 26.4%, primarily due to rising interest rates leading to losses on FVTPL bonds and the consolidation of Ping An Good Doctor [2] - The company's new business value (NBV) in life and health insurance reached 12.9 billion yuan, reflecting a year-on-year increase of 34.9%, driven by improvements in the NBV margin [2] - The comprehensive cost ratio for the property and casualty insurance business improved significantly, decreasing by 3.0 percentage points to 96.6% in Q1 2025 [3] - The investment performance remained relatively stable, with a non-annualized comprehensive investment return of 1.3% and a net investment return of 0.9% in Q1 2025 [3] Financial Performance Summary - For 2025, the company expects operating revenue to reach 105.68 billion yuan, with net profit attributable to shareholders projected at 14.22 billion yuan [4][13] - The company’s EPS is forecasted to be 7.81 yuan in 2025, increasing to 10.43 yuan by 2027 [4][12] - The P/B ratio is expected to decline from 1.03 in 2023 to 0.76 by 2027, indicating a potential undervaluation [4][12] Business Segment Insights - The life and health insurance segment achieved an operating profit of 26.9 billion yuan in Q1 2025, a year-on-year increase of 5.0% [2] - The new single premium decreased by 19.5%, but the first-year premium NBV margin improved by 11.4 percentage points to 28.3% [2] - The agency channel maintained a stable agent count of 338,000, with a year-on-year increase of 14% in per capita NBV [2] Investment Strategy - The report suggests a target price of 58.51 yuan over the next six months, based on a valuation of 0.7x 2025 P/EV [3][6]