Full Article at IIR has reaffirmed its Recommended rating for PIA after undertaking a review post the appointment of a new Portfolio Manager, Harding Loevner. The full report can be found on the IIR website. On 26 July 2021, Pengana International Equities Limited (PIA) announced a fully franked dividend of 1.35 cents per share for the June quarter. This represents an 8% increase on the March quarter dividend and takes the total dividends declared for FY21 of 5.1 cents per share, fully franked....
With revenue growing 7%, no-moat PICC Group’s first-quarter net profit growth rebounded 12% from the year-ago period, up from a 20% decline in 2018. As expected, the results reflected ongoing restructuring of the life insurance business and worsening underwriting profitability of the property-casualty insurance business. The 24% increase in investment return and lower tax rate helped offset this negative impact over the quarter, leading to a solid bottom-line rebound. Because the results are l...
With revenue growing 7%, no-moat PICC Group’s first-quarter net profit growth rebounded 12% from the year-ago period, up from a 20% decline in 2018. As expected, the results reflected ongoing restructuring of the life insurance business and worsening underwriting profitability of the property-casualty insurance business. The 24% increase in investment return and lower tax rate helped offset this negative impact over the quarter, leading to a solid bottom-line rebound. Because the results are l...
No-moat PICC Group’s 2018 results recorded a 20% decline in net profit to CNY 12.9 million, dragged by a 22% net profit decline in its core P&C insurance segment and weaker investment returns, which were partially offset by improved underwriting margin of life and health segments. Given operating performance of its auto insurance business came in weaker than our expectation in the second half of 2018, we reduced our fair value estimate to HKD 3.50 from HKD 4 per share to reflect our less optim...
No-moat PICC Group’s 2018 results recorded a 20% decline in net profit to CNY 12.9 million, dragged by a 22% net profit decline in its core P&C insurance segment and weaker investment returns, which were partially offset by improved underwriting margin of life and health segments. Given operating performance of its auto insurance business came in weaker than our expectation in the second half of 2018, we reduced our fair value estimate to HKD 3.50 from HKD 4 per share to reflect our less optim...
No-moat PICC Group’s 2018 results recorded a 20% decline in net profit to CNY 12.9 million, dragged by a 22% net profit decline in its core P&C insurance segment and weaker investment returns, which were partially offset by improved underwriting margin of life and health segments. Given operating performance of its auto insurance business came in weaker than our expectation in the second half of 2018, we reduced our fair value estimate to HKD 3.50 from HKD 4 per share to reflect our less opt.....
We think China’s latest cut in its reserve requirement ratio will have only a limited impact on the valuations of the Chinese insurers we cover. The RRR cut will affect insurance investment return and reserving charges as interest rates decline after the liquidity injection. However, we expect the negative impact on investment returns will be smaller than what the market is expecting, thanks to a five- to seven-year holding period of fixed-income investments, rising profit contribution from ...
We think China’s latest cut in its reserve requirement ratio will have only a limited impact on the valuations of the Chinese insurers we cover. The RRR cut will affect insurance investment return and reserving charges as interest rates decline after the liquidity injection. However, we expect the negative impact on investment returns will be smaller than what the market is expecting, thanks to a five- to seven-year holding period of fixed-income investments, rising profit contribution from ...
PICC Group is the oldest and largest state-owned insurance group in China. The company aims to transform from a leading property-casualty insurer into an integrated one-stop shop for financial services. However, we see significant headwinds, given the current soft P&C insurance market and lackluster life insurance product mix, which are likely to result in mounting product maturity pressure.The flagship P&C subsidiary, PICC P&C, operates in the highly concentrated and fast-growing Chinese P&C in...
No-moat PICC Group’s first-half results posted 2.3% year-on-year premium growth, representing 52% of our full-year forecast and in line with our expectation. Upside surprise came from improved underwriting margins of life and health insurance business, with operating margins rising to CNY 1.53 billion and CNY 22 million from a loss of CNY 140 million and CNY 12 million, respectively. The turnaround of the life insurance segment was attributable to lower claim expenses as the business structure...
No-moat PICC Group’s first-half results posted 2.3% year-on-year premium growth, representing 52% of our full-year forecast and in line with our expectation. Upside surprise came from improved underwriting margins of life and health insurance business, with operating margins rising to CNY 1.53 billion and CNY 22 million from a loss of CNY 140 million and CNY 12 million, respectively. The turnaround of the life insurance segment was attributable to lower claim expenses as the business structure...
No-moat PICC Group’s first-half results posted 2.3% year-on-year premium growth, representing 52% of our full-year forecast and in line with our expectation. Upside surprise came from improved underwriting margins of life and health insurance business, with operating margins rising to CNY 1.53 billion and CNY 22 million from a loss of CNY 140 million and CNY 12 million, respectively. The turnaround of the life insurance segment was attributable to lower claim expenses as the business structure...
No-moat PICC Group’s first-half results posted 2.3% year-on-year premium growth, representing 52% of our full-year forecast and in line with our expectation. Upside surprise came from improved underwriting margins of life and health insurance business, with operating margins rising to CNY 1.53 billion and CNY 22 million from a loss of CNY 140 million and CNY 12 million, respectively. The turnaround of the life insurance segment was attributable to lower claim expenses as the business structure...
No-moat PICC Group’s brief financial summary reported first-quarter total premium income and net profit of CNY 175 billion and CNY 10.8 billion, respectively. As results are largely in line with expectations, we retain our CNY 4.30 per share fair value estimate. The stock is trading at a 15% discount to our fair value estimate, as the market is not optimistic about its transformation. Though we acknowledge the weak fundamentals of the nonlife insurance business, we think the stock is undervalu...
The 14.4% net earned premium growth was driven by a 12% increase in auto insurance and 19.2% growth in the nonauto insurance business, boosted by accidental injury and health insurance, agricultural insurance, and liability insurance, which represented 75% of total nonauto insurance premium. Despite a 10.6-percentage-point decline in new passenger car sales to 3% from 2016 in China, PICC P&C’s new-car sales policy growth remained solid at 11.5%, gaining 0.9 percentage points of market share......
Following PICC P&C’s upbeat third-quarter announcement, we have increased our fair value estimate for PICC P&C to HKD 17.50 per share from HKD 16 per share, as we increase our premium growth assumption and fine-tune our underwriting margin assumption for the next two years. Accordingly, we increase our fair value estimate for PICC Group to HKD 4.30 from HKD 4 per share, as the group owns 69% of PICC P&C, which contributed 98% of profit before tax for the group in 2016. The firm's oth...
PICC Group’s first-half results showed that the group’s life insurance business is still undergoing a slow and difficult transformation to a life insurer with higher exposure to long-term protection products compared with leading peers. The transformation is also being met with rising competition in the group's market-leading core property-casualty insurance business. Net profit grew 14% from the year-ago period, but if excluding profits from associates including Industrial Bank and Hua Xia ...
China recently announced expansion of the pilot program for tax-exempt commercial health insurance, which allows up to CNY 2,400 to be deducted from tax liability per person per year in the whole country starting from July 2017. There are five specialized health insurance companies, including Hexie Health, PICC Health, Ping An Health, Kunlun Health and CPIC Allianz Health. Hexie Health, PICC Health and Ping An Health are the three largest health insurers in China. Despite the hefty growth, all...
PICC Group has announced that the company plans to apply for an IPO on the Shanghai Stock Exchange, which is now pending shareholder and regulatory approval. The total new issuance will not exceed 4.6 billion shares, or 10.8% of current outstanding shares. The IPO is expected to complete within 12 months once shareholder approval is obtained. As no detailed plan has yet been disclosed, we retain our HKD 3.50 fair value estimate. The upcoming A-share IPO will boost the company’s capital positio...
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