德意誌銀行的中國保險行業分析(pdf 28頁)

Sector overview……..................... 3
Outlook ……...........................3
Valuation ……..........................3
Risks ……...................................3
Impact of new business on stock valuations .................................. 4
Sensitivity of our price target to new business profit growth.....................................4
Conclusion – risks to new business profit growth assumptions.................................5
New business trends……............. 7
Who’s winning and who’s losing ……....................7
Product trends – shift back towards regular premium products.................................8
Profit margin impact ……...........9
Gross premium expectations ……....... 11
2H04F and full-year premium income predictions ……..11
New business: 2004 outlook……......... 14
How do industry gross written premiums translate into new business sales? ........14
The importance of new business ……..................18
Global insurance valuations ……......... 20
Global insurance price performance.............. 22

The outlook for new business (NB) profit remains critical for life insurance
valuations. With four months of sales still to be collected (September to December),
our preliminary estimates are for FY04 growth of 24% at China Life, while growth
for Ping An will be at best flat. This supports our price target of HK$5.10 for China
Life and implies downside risk for Ping An (HK$10.25 price target).
Our estimates are based on industry gross premium data, which we forecast to
grow in the range of 10-15% in FY04. Based on year-end market share forecasts
and stable margins we derive our NB profit growth forecasts. We have kept the mix
of regular/single premium steady against 1H04.
China Life – despite trading in line with our price target of HK$5.10, China Life
remains our preferred stock pick. A positive shift in product mix towards risk/regular
premium business and +40% NB sales growth in 1H04 support this positive theme.
Our NB profit growth expectations for FY04 are conservatively struck at 25%.
Ping An – having run ahead of reasonable investment fundamentals we have a Sell
rating on Ping An with a HK$10.25 price target. Our preliminary assessment of NB
profit growth in FY04F suggests Ping An may fall short of our 10% valuation
assumption. Flat growth in FY04F reduces our price target by 6% to HK$9.65.……

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