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Morningstar | Ping An Sees Robust Growth in Customer Acquisition Continue

In China's highly competitive insurance market, Ping An stands out for its ability to use proprietary technology to strengthen the customer experience and enhance cross-sales for its four major ecosystems: financial, health, auto, and real estate. We believe its competitive advantage make the company stand out among peers, leading to an better outlook than peers in terms of underwriting profitability and growth.Ping An differentiates itself with its technological focus and conglomerate business model that includes insurance, banking, asset management, fintech, and healthtech. While its banking segment has become a valuation drag due to worsening credit cycle and uncertainties during the business transformation, we applaud the company's strategy of positioning its banking unit as major entry point for customers, via the provision of one-stop financial service and high-frequency interactions for both retail and corporate financial needs. Ping An now boasts one of the largest retail customer bases in China's financial industry, with over 538 million Internet users and 184 million financial customers, delivering enviable 41% and 20% respective CAGRs in Internet and financial customers over the past four years. Its customers tend to have higher income and are more receptive to technology, as evidenced by industry-leading profit per customer and number of contracts per customer. Helped by the success of integrated offline and online platforms, as well as adoption of new technology, Ping An delivered stronger-than-peer growth in new business value and embedded value over the past five years.Ping An boasts industry-leading technology adoption, boosting top-line growth, lower operating expense, and enhanced risk management. It facilitates rising cross-sales of financial services to its fast-growing customer base. It applies its world-class AI technology in over 200 scenarios, including banking and insurance services, significantly improving the customer experience while saving on on-the-spot staff costs and ensuring the security of online platforms. Increasing technology exportation and the potential separate listing of its fintech subsidiaries provide further upside.