Xinhua Insurance (601336): Profitability has improved business development to be recovered
On the evening of October 30, 2019, Xinhua Insurance announced its third-quarter results for 2019, with net profit attributable to its mother of RMB 13 billion, an increase of 68 during the same period.
8%, the total investment yield is 4.
7%, down by 0 every year.
Investment points: Tax cuts will boost the growth rate of net profit, and investment will help multiply the comprehensive income: the company’s net profit attributable to its mother in the first three quarters was 13 billion, an increase of 68.
8% of plasma from 25.
4 billion outstanding expectations-6.
8 billion, first and foremost in the first three quarters of 2018 and 2019.
In addition, due to the floating profit of AFS assets brought by the improvement of the stock market, other comprehensive income was -31.
700 million outstanding turned to 36.
700 million, so the comprehensive return to motherhood increased by 268% per year to 16.7 billion.
Changes in actuarial assumptions in the first three quarters reduced profit before taxes.
800 million, assuming the cause of the adjustment is worthy of attention.
The futures delivery business still needs to be improved, and long-term NBV growth continues to be under pressure: new single-term delivery in the first three quarters was 16 billion, a decrease of 6 in the same period.
9% (+1 in the first half of the year.
1%), of which new orders of ten years or more are due 88.
900 million, down 15 every year.
4%, the decline has narrowed, and the business side has not yet seen a significant recovery. Instead, it has re-launched a new promotion strategy and made subsequent improvements.
Due to the sluggish business growth, it is expected that the growth rate of new business value in the first three quarters is also not satisfactory. At the same time, it is difficult to significantly improve the growth rate of NBV because it is difficult to see high growth in the fourth quarter due to preparations.
Investment assets grew rapidly, and the total investment yield was slightly lower than expected: benefiting from the steady growth of premiums and a significant drop in the surrender rate (from 4).
5% interest rate 1.
4%), the company’s investment assets increased significantly compared to the beginning of the year12.
2% to 785 billion, with an annualized return on investment of 4%.
7%, down by 0 every year.
1pct, the floating profit of AFS assets has not yet been reflected 都市夜网 in the income statement, resulting in a slightly higher than expected return on total investment. If the full-caliber return on investment is considered, it will significantly increase.
Profit forecast and investment recommendations: From the perspective of the three quarterly reports, the company’s merger of NBV is still under pressure, and subsequent follow-up needs to focus on the actions of the new session. However, the long-term profitability of the transition company has significantly improved after a few years.
Under the assumption of 5% return on investment, the EPS for 2019-2021 is forecast to be 4.
57 yuan, corresponding to 10 for PE.
86 times, EVPS is 65.
43 yuan, corresponding to PEV of 0.
67/0.59 times, comprehensively consider long-term profitability and current expectations, and maintain a “Buy” rating.
Risk factors: Sales of new orders are less than expected, overall production capacity continues to decrease, equity market declines