China Life Insurance (601628): Values, Channels, Assets and Debts Exceeded Expectations
The company announced the third quarter of 2019: operating income of 624 billion, an annual increase of 15.
4%; net profit attributable to mothers was 57.7 billion, an increase of more than 190%, exceeding market expectations; the value of new business further increased by 20.
4%, exceeding expectations and far exceeding the growth rate of its peers.
The three quarterly results were much better than expected, and investment contributed.
The company’s net profit attributable to its mother in the first three quarters was 57.7 billion, an increase of more than 190%, and in the third quarter alone was 20.1 billion, an increase of more than 483%. The 北京桑拿网 performance growth exceeded expectations: The total profit in the first three quarters has exceeded the expected annual profit scale of mainstream market institutions.The third quarter profit set a new record for the company’s historical quarterly performance.
The reasons for the growth in the third and third quarters are consistent with our relative expectations: (1) The investment income has increased significantly. The investment income in the third quarter alone was 45.8 billion, a 87% increase over the same period. In contrast, the market performance over the same period (declining equity market and overall bond market)Shock), the high growth rate of investment returns deeply reflects the company’s continuous deepening of the effectiveness of market-oriented reforms of the investment management system.
In 2019, the 杭州桑拿 company grasped the window to increase the allocation of ultra-long-term local bonds and high-quality non-standard assets, and the income increased; at the same time, the company strengthened the allocation of core equity assets, and the distribution income also increased significantly. The grasp of the rhythm of stocks and bonds jointly promoted the net investment yield.The same / ring ratio is increased by 0.
21pct / 0.
17 points to 4.
82%; (2) The tax rate is reduced, and the adjustment of the prepayment policy of fees and commission taxes reduces the company’s overall tax rate, and the yield in the third quarter is only 11.
9%, pushing up the scale of profits.
In the first three quarters, the increase in profit scale due to the decline in the overall tax rate was 4.4 billion, which is obvious.
The growth rate of new business value exceeded expectations, and the transformation achieved initial appearance.
The value of new business in the first three quarters increased by 20.
4%, exceeding market expectations and continuing to lead the industry (Ping An was only 4.
5%, CPIC and Xinhua’s growth rate is expected to be negative).
The core of the company’s growth against the market lies in the continuous optimization of the product structure under the background of new orders remaining relatively stable. The company adheres to the “reinvigorating the value of life” business model around the goal of “rejuvenating China Life”.Comprehensive transformation guarantees product sales, and at the same time, it sets higher guarantee product evaluation indicators.
Growth rate of new business value in the first three quarters (20.
4%) than the middle report (22.
7%) Slightly lower than expected in the market. Due to the pre-assessment in advance, the focus of work shifted to human development in the third quarter, and the growth rate of new orders was slightly distorted. However, as the company continued to focus on sales of guaranteed products, the product structure was stillContinuous optimization and further increase in the value rate pushed the new business value to gradually grow faster than expected.
In the first three quarters, the proportion of guaranteed products in the first year’s premiums increased by 8%.
79 averages, a further improvement over the 5 additional reports.
Looking ahead, in 2020, the company’s new business value is expected to achieve continued growth against a high base, and the transformation will turn into a fleeting one.
Some breakthroughs, pre-sale work ahead of schedule, the growth of manpower scale, product competition and other comprehensive factors, 2020 starters are expected to achieve double-digit growth against a high base.
At the same time, at the same time, the company’s performance meeting indicated that in 2020, it will further increase the evaluation of guaranteed products based on 2019. With reference to the current improvement of the company’s product structure, the company’s overall new business value rate will continue to increase and promoteGradually realize the value of new business and maintain a high-speed growth trend, and continue to verify the company’s transformation speed, determination and results.
The team grew faster than expected, and “volume expansion” paralleled “improvement”.
(1) In terms of volume, at the end of the third quarter, the company’s agent size was 166.
30,000 people, an increase of 14 in ten years.
5%, an increase of 15 from the initial period.
4%, an increase of 6% from the mid-month report, an increase that surpassed market expectations.
In 2019, the company’s agent team showed a trend of increasing quarter by quarter (18A = 1.44 million, 19Q1 = 153.
70,000, 19H1 = 157.
30,000), the growth of the company’s team is based on the requirements of higher entry standards and alternative and relaxed export standards, and the continuous growth of manpower in the industry, the core reason for the strong growth of agents is: first, the performance of the starters is not goodVulgarity boosts the morale of the long boots and putter team; second, the company’s business development is more flexible when the business indicators are completed better; third, the company moderately expands its expenses, the first three quarters of fees and commission expensesIncreased by 30%, per capita income was 4513 yuan (calculated caliber, average manpower is the scale at the Q3 point in time and the scale at the initial point in time, the same below), increased by 27%; (2) in terms of quality, the average effective labor force increased by +27.
4%, the average monthly sales of specific protection products manpower up to +49.
2%, all showed a clear improvement trend.
In addition, the average manpower of the company increased by 2.
31%, and an increase of 20 compared to the same period of NBV.
4%, can push the company’s per capita NBV significantly increased.
Investment suggestion: We have listed China Life as the first bidder, and the three quarterly results have exceeded overall expectations. Performance growth, new business value growth, team size and quality have clearly exceeded market expectations and peer data, and our research findings are not pure.Reason for base.
At the same time, according to the current arrangement and progress of the company’s start-up pre-sale, we expect that the start-up will still achieve two digital growth in 2020, again exceeding market expectations, and at the same time, it is expected to continue to the high-speed growth trend in 2019, step by step to verify the transformation of China LifeThe determination and the continuity of performance have restored China Life’s former glory.
Considering that the company’s debt-side business structure still has room for significant improvement, the future value rate growth space will be the highest in the industry and the core driving force for the company’s value growth.
The company’s management, fundamentals (debt, assets, value), the expected difference is very big, and the current company follows the corresponding 2020 return (20E EVPS is 39.
17 yuan a year + 18%) only 0.
79 times, the target is estimated to be 1 times, and the target price is 39.
2 yuan, 27% space.
Risk reminder: The company’s gradual transformation exceeds expectations, the transformation intensity exceeds expectations, and the increase in the value rate is less than expected; in the 2020, the debt end of the industry will intensify, and then the new orders will grow weak and the manpower will increase.The market has dropped significantly