The article "After the Performance" summarizes major banks' investment ratings, target prices, and opinions on Ping An's performance announcement

Ping An (02318.HK) announced its performance for last year after the market closed yesterday (26th), and today (27th) its stock price rose nearly 2% to HKD 59.3. China International Capital Corporation (CICC) stated that Ping An's performance last year was basically in line with expectations, with the advantages of its integrated financial model becoming evident, and the number of value customers increased by 6% year-on-year. Property insurance has become a strong customer acquisition channel, migrating 4.5 million customers to other businesses over the past three years. The firm believes that the company's integrated financial development is promising and is expected to support long-term stable returns for shareholders. It also noted that the company's original premiums for auto insurance and non-auto insurance increased by 3.2% and 14.5% year-on-year, respectively, while the overall cost ratio decreased by 2.3 percentage points and increased by 0.1 percentage points to 95.8% and 98.9%, respectively. Among them, the original premium for new energy vehicle insurance increased by 39% year-on-year to RMB 52.5 billion, achieving underwriting profit for the whole year, and is expected to become a major growth driver for auto insurance in the future. Additionally, the new business value rate based on standard premium increased significantly by 5.8 percentage points year-on-year to 28.5%. The new business value per agent increased by 17.2% year-on-year, with continuous improvement in productivity; the new business value from the bancassurance channel increased by 1.38 times year-on-year, solidifying the diversified channel structure. The firm assigned Ping An an "outperform industry" rating with a target price of HKD 95.

The company reported a year-on-year decline in revenue of 0.1% to RMB 1,140.324 billion, while net profit increased by 6.5% year-on-year to RMB 134.778 billion; earnings per share were RMB 7.68. A final dividend of RMB 1.75 was declared, compared to RMB 1.62 in the same period last year. The total annual cash dividend per share was RMB 2.7, an increase of 5.9% year-on-year; the cash dividend ratio based on net profit attributable to shareholders was 36.4%. During the period, the new business value of life insurance and health insurance increased by 29.3% year-on-year to RMB 6.897 billion, with the new business value from the agent channel increasing by 10.4% year-on-year, and the new business value per capita growing by 17.2% year-on-year; the new business value from the bancassurance channel increased by 138% year-on-year. The contribution of the bancassurance channel, community financial services, and other channels to the new business value of Ping An's life insurance increased by 12.1 percentage points year-on-year.

Ping An's property insurance business achieved original premium income that increased by 6.6% year-on-year to RMB 343.168 billion; insurance service income increased by 3.3% year-on-year to RMB 338.912 billion. The overall combined cost ratio decreased by 1.5 percentage points year-on-year to 96.8%, mainly due to optimization of auto insurance costs and the turnaround of guarantee insurance to profitability. The combined cost ratio for auto insurance decreased by 2.3 percentage points year-on-year to 95.8%. The scale of the insurance fund investment portfolio increased by 13.2% year-on-year to RMB 6.49 trillion; the overall investment return rate increased by 0.5 percentage points year-on-year to 6.3%; the average net investment return rate over the past 10 years was 4.8%, and the average overall investment return rate over the past 10 years was 4.9%, exceeding the long-term investment return assumptions of embedded value 【Bank of America expects Ping An's CSM to achieve positive growth this year】

Bank of America Securities stated that Ping An's new business contract service margin (CSM) and effective policy expected return (inflow) are far lower than the policy value release (outflow), with the policy value expected to decline by 6% and 5% respectively between 2023 and 2024. Last year, the policy value balance only decreased by 1%, and the company is expected to report better new business CSM growth, with a positive CSM growth expected this year. The bank pointed out that stable CSM releases are a key support for the core income growth of insurance companies. The bank also noted that Ping An Property & Casualty's pre-tax operating profit increased by 13% year-on-year. Last year's overall combined ratio improved by 1.5 percentage points to 96.8%, with premiums increasing by 7% year-on-year. However, Ping An Bank's net profit decreased by 4% year-on-year, underperforming expectations. After the trend of narrowing net interest margin ends, it may take one to two years to see a recovery in growth. The bank has given Ping An a "Buy" rating with a target price of 74 yuan.

Goldman Sachs stated that Ping An's performance last year was generally in line with expectations. In the fourth quarter of last year, pre-tax operating profit increased by 35% year-on-year, mainly driven by a reduction in asset management business losses and improvements in property and casualty underwriting performance. The asset management business recorded a net loss of 3.8 billion yuan last year, with a loss of 6.4 billion yuan in the fourth quarter alone. This is better than the 9.6 billion yuan loss in the fourth quarter of 2024, but it shows that the asset quality of this business segment is still under continuous pressure. The bank also noted that the company's new business value in life insurance increased by 29% year-on-year to 36.9 billion yuan, which is 6% and 3% lower than the bank's and market consensus expectations, respectively. However, this may reflect the impact of negative assumption changes. The bank believes that Ping An's actual new business value should be in line with expectations. In addition, the underwriting performance of property and casualty insurance was slightly better than expected, with the combined ratio dropping to 96.8%, better than the bank's and market consensus forecasts of 97.3% and 97.2%, respectively. The bank has given Ping An a "Buy" rating with a target price of 74 yuan.

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The latest comprehensive investment ratings and target prices from 6 brokerages:

Brokerage│Investment Rating│Target Price

Morgan Stanley│Overweight│95 yuan

CICC│Outperform│99.4 yuan

Citi│Buy│85.5 yuan

Bank of America Securities│Buy│74 yuan

Goldman Sachs│Buy│74 yuan

Citi Research│Outperform│71 yuan

Brokerage│Viewpoint

Morgan Stanley│Steady growth meets expectations, entering the late stage of risk reduction

CICC│Performance meets expectations, comprehensive financial development is promising

Citi│New business value, net profit, and dividends are generally in line with expectations, cost ratio exceeds expectations, asset management net loss reduced by 68%

Bank of America Securities│Performance is stable, contract service margin is at a turning point

Goldman Sachs│Profit and dividends are in line with expectations

Citi Research│Post-tax operating profit and dividends are stable