2025-08-31 16:21Summary of New China Life (1336.HK) 1H25 Results Conference Call Company Overview - Company: New China Life Insurance Co., Ltd. (NCI) - Ticker: 1336.HK - Date of Report: 28 Aug 2025 Key Financial Metrics - Net Business Value (NBV): Increased by 58% year-over-year (yoy) to Rmb6.2 billion in 1H25, leading industry peers [2] - Net Profit: Rose by 34% yoy to Rmb14.8 billion in 1H25 [3] - Total Investment Income: Increased by 43% yoy to Rmb45.3 billion [3] - Book Value (BV): Decreased by 13% half-on-half (hoh) to Rmb83.4 billion [3] - Core Solvency Ratio: Slipped by 13 percentage points quarter-on-quarter (qoq) to 171% [3] - Interim Dividend per Share (DPS): Increased by 24% yoy to Rmb0.67 [3] Business Performance - First Year Premium (FYP): Doubled yoy in 1H25, contributing to the strong NBV growth [2] - NBV Margin: Eroded by 3.9 percentage points yoy to 14.6% [1] - Banca Channel: NBV rose 1.4 times yoy to Rmb3.3 billion, with a 1.5 times yoy FYP increase [2] - Agency Channel: NBV increased by 12% yoy to Rmb3.1 billion, despite a 9.9 percentage point margin deterioration [2] - Agency Force: Downsized by 2% hoh to 133,000 agents [2] Investment Performance - Annualized Total Investment Yield: Increased by 1.1 percentage points yoy to 5.9% [3] - Investment Yield: Net investment yield decreased by 0.2 percentage points yoy to 3.0% [3] Valuation and Target Price - Target Price for H-Share: HK$49.6, implying a Price/Embedded Value (EV) multiple of 0.45x in 2026E [9] - Target Price for A-Share: Rmb69.9, implying a Price/EV multiple of 0.68x in 2026E [11] Risks and Opportunities - Downside Risks: Include sharp A-share market corrections, macroeconomic slowdown in China, stringent regulations on insurance agents, and falling bond yields [10][12] - Upside Risks: Include potential stimulus policies, macro recovery in China, and regulatory relaxation on bancassurance sales [10][12] Additional Insights - CSM Balance: Increased by 1% yoy to Rmb177.2 billion as of end-1H25 [1] - Investment Asset Breakdown: Cash and deposits accounted for 21.5%, bonds for 58.5%, and equities for 19.2% of total investment assets [7] - Market Capitalization: HK$148.2 billion (US$19.03 billion) [4] This summary encapsulates the key financial metrics, business performance, investment performance, valuation, risks, and additional insights regarding New China Life's 1H25 results, providing a comprehensive overview for potential investors and stakeholders.