China Life (601628): New business value surpasses expectations Agent performance is strong

China Life (601628): New business value surpasses expectations Agent performance is strong

Performance review 1Q19 results exceeded expectations 1Q19 results announced by the company: the value of new business (the company disclosed in the quarterly report for the first time) or an increase of 28%, exceeding market 苏州桑拿网 expectations.

Net profit increased by 93% annually, in line with expectations.

  Development trend The value of new business is actually higher than expected, and 2Q19 will remain high.

The value of new business, which the company first disclosed in its quarterly report, increased by 28% over the long term.

We think this is benefiting from: 1) the increase in the value of new business brought about by the improvement of the product structure and 2) the steady growth of new orders (the growth of new premiums for the period of 9%)

We expect that the execution power brought by the new leaders will be greatly enhanced and will drive the 2Q19 new business value to maintain a high growth rate.

  The strong proxy indicators helped the long-term growth of new orders continue to lead the industry.

The number of agents at the end of the first quarter was 153.

70,000, an increase of 7% over the beginning of the year, reflecting the good recruitment and retention of agents.

Improved quality of agents: The average monthly effective sales manpower of individual insurance channels increased by 38%, and the average monthly manpower scale of sales of guaranteed products increased by 60%.

We believe this is mainly due to 1) the regular adjustment of product strategy in the first quarter of 19th (the proportion of guaranteed and high-value savings businesses in the business plan increased) and 2) the continuous improvement of the status of the agent team since 2H18.

  The improvement in investment promoted a substantial increase in net profit.

The expected growth rate of net profit in the first quarter of 19 reached 93%, because it has been announced, which is in line with market expectations.

Profit growth was mainly due to the improvement of the total investment yield (gradual increase) driven by the growth of the stock market.

8 up to 6.


  We continue to be optimistic about the company’s investment opportunities based on: 1) New participation brings a significant improvement in active business strategies and execution; 2) Gradually achieve new business growth and continue to lead the industry, while the business structure is better than market expectations.

  Earnings forecast has resulted in better-than-expected profits through investment improvement. We raised our 2019 / 20e earnings forecast by 85% / 70%.

At the same time, raise 北京夜网 the 2019 / 20e new business value forecast1.

5% / 1.


  Estimates and recommendations currently correspond to China Life-A / H corresponding to 19 years 0.


6 times P / EV.

Maintain China Life-A / H’s recommended / recommended rating and target price of RMB 36 / HKD 28 respectively, corresponding to 1 in 19 years.


8 times P / EV, compared with the current sustainable growth of 22% / 29%.

  Risk growth of long-term interest rates has fallen; the stock market has fluctuated significantly.