摩根士丹利-中国-保险行业-中国及香港保险业2020供给侧改革之年-2019.12.4-54页.pdf

1、Jenny.JGreen.CXiaoyue.QAttractiveMORGAN STANLEY ASIA LIMITED+Jenny Jiang,CFAEQUITY ANALYST+852 2848-7152Green CaiRESEARCH ASSOCIATE+852 2848-5686Birlina QiRESEARCH ASSOCIATE+852 3963-4087Hong Kong/China InsuranceAsia PacificIndustryViewHong Kong/China InsuranceHong Kong/China Insurance|Asia Pacific

2、Asia Pacific2020:A Year of Supply-sideReformsMore reforms on product and distribution could take place todeal with changes in regulation,demand and competition.Growth may remain moderate,but should support 10%sharegains plus 3-5%dividend yields.Rerating can still happen forquality names such as AIA,

3、PICC and Ping An.Life-Align products with demand;revamp channel strategy:Despite someconcerns,we believe overall demand for life insurance remains healthy in China,evidenced by still-solid industry first-year premium(FYP)growth(Exhibit 9).Listed insurers lost share to smaller players because of thei

4、r slower response tonew demand trends,and the listed companies highly concentrated products andchannel strategies(high-end critical illness products through agency channel)may need to be more diverse with a wider variety of products across all pricingpoints and more omni-channel offerings in 2020.We

5、 expect more radical supply-side reforms to strengthen the listed players competitive advantage in 2020.In ayear of adjustments,VNB growth may remain moderate at 5-10%,in our view.Regulatory and policy changes can bring upside risks,such as a change inmorbidity tables(often leads to a short-term jum

6、p in sales due to new productlaunches),or favorable tax treatment on pensions if the current pilot programsare expanded nationwide.Downside could come from further opening up ofChinas life business and increasing competition in the high-end market.P&C Will auto reforms finally arrive?2019 has shaped

7、 up to be one of thebest years for Property and Casualty(P&C)with steady top-line growth(+11%in9M19)and significant earnings rebound(+96%).Premium growth and marginexpansion should continue into 2020,supported by favorable policies on non-auto and a tight regulatory oversight in auto.We expect 10-30

8、%underlyingearnings growth even from high bases.As the industry stabilizes,regulator couldresume auto reforms.While detarrification can be a headline risk,the impact maynot be as substantial according to pilot program results.Still prefer quality over turnaround stories:We still favor leaders in eac

9、hsegment AIA in the region,PICC in P&C and Ping An in Life.Insurers working toturn around(China Life,PICC Life)could outgrow quality names for one moreyear,but likely by a smaller margin not justifying the risks taken due to a morevolatile growth profile,in our view.Even without a major rerating,und

10、erlyinggrowth should still be 10%across key financial metrics(earnings,BV and EV),supporting 15%total returns(including dividends);hence,we maintain ourAttractive industry view.Insurers with substantial quality improvement(Ping Ansdistribution revamping;PICCs modernization)and risk reduction(subsidi

11、ng HKrisk for AIA)could lead to additional upside from multiple expansion.Exhibit 1:Summary of ratings and price targetschanges%TickerRatingUpsideOld PTNew PTEPSgrowth*VNBgrowth*H Share(HK$)AIA1299.HKOW1792921817Ping An2318.HKOW27111114188PICC P&C2328.HKOW42121310NACPIC2601.HKOW40393935Zhong An6060.

12、HKOW213034-106NAChina Life2628.HKEW162223510PICC Group1339.HKEW153.53.6810NCI1336.HKEW17403555CTIH0966.HKEW17242154China Re1508.HKUW61.41.3910A Share(Rmb)Ping An601318.SSOW2297102188CPIC601601.SSEW1343535NCI601336.SSUW-30353155China Life601628.SSUW-391920510PICC Group601319.SSUW-523.13.2810*Data sho

13、wn above are for FY20E;E=Morgan Stanley Research estimates.Source:Company data,Refinitiv,Morgan Stanley Research.Morgan Stanley does and seeks to do business withcompanies covered in Morgan Stanley Research.As aresult,investors should be aware that the firm may have aconflict of interest that could

14、affect the objectivity ofMorgan Stanley Research.Investors should considerMorgan Stanley Research as only a single factor in makingtheir investment decision.For analyst certification and other important disclosures,refer to the Disclosure Section,located at the end of thisreport.+=Analysts employed

15、by non-U.S.affiliates are not registered withFINRA,may not be associated persons of the member and may notbe subject to NASD/NYSE restrictions on communications with asubject company,public appearances and trading securities held bya research analyst account.1December 4,2019 09:00 AM GMT每日免费获取报告1、每日

16、微信群内分享7+最新重磅报告；2、每日分享当日华尔街日报、金融时报；3、每周分享经济学人4、行研报告均为公开版，权利归原作者所有，起点财经仅分发做内部学习。扫一扫二维码关注公号回复：研究报告加入“起点财经”微信群。Whats in the PriceCompanyWhats in the priceWhats the market missing?China LifePing AnCPICNCIChina Lifes share price performed strongly in 2019,with its H-shares up 20%YTD vs.6%on average for the industry(H-share insurers)on a substantialgrowth recovery the company is on track to report 15%VNB growth and400%earnings growth for 2019,one of the highest amongst listed peers,partially due to a l