Xinhua Insurance (601336) Company Annual Report Comment: Health Insurance’s 10-year Growth Rate Exceeds 30%

Key points of investment: In the first year of health insurance premiums, the annual premium is + 31%, which accounts for a significant increase of 26ppt to 59%, driving the NBV profit margin to 48% at +8 each time.


The sales force of the marketing team has steadily improved.

Continue to focus on leadership candidates and business development strategies.

Estimate is still low, “expected market” rating.

Xinhua’s 2018 annual report performance: 1) Net profit attributable to mother 79.

2.2 billion, previously + 47%.

2) Net assets of US $ 65.6 billion, + 3% from the beginning of the year and -2% from the end of the third quarter.

3) NBV +1.

2%, EV increased by 13% compared with the beginning of the year, NBV growth rate exceeded our low-base + guaranteed development released on February 23, to accumulate value growth in 2019-Insurance Industry Annual Report 2018 Preview, EV The growth rate was slightly lower than expected.

4) The remaining margin is 1956 trillion, + 15% compared with the beginning of the year.

The increase in performance is related to the increase in reserves during the same period last year, and the specific base.

1) In 2017, the 750-day curve went down, and the reserves were further subdivided. The “change in accounting estimates” affected the gradual decrease in pre-tax profit by USD 8.3 billion, resulting in a net profit of only USD 5.4 billion in 2017.

2) The “change in accounting estimates” in 2018 affected the highest pre-tax profit impact of US $ 5 billion. We estimate that it is mainly because the data on the incidence of severe diseases (such as thyroid cancer) has deteriorated, and the company has made more careful assumption adjustments.

NBV increased by half a year.

2%, the margin of new business value increased by 8% year-on-year.


1) The new single premium is -19% for half a year. The NBV is slightly higher than the positive growth due to the continuous optimization of the business structure. The NBV margin is as high as 47.

9%, +8.


Under the strategy of “promoting the main by supplement”, the premium of health insurance long-term insurance twice in the first year + 31%, accounting for 59% of the company’s first-year insurance premium, each time + 26ppt, driving more than ten years of payment to account for the first yearThe annual turnover ratio increased to 61%.

2) The number and quality of teams have steadily improved.

There are 370,000 individual insurance teams, an increase of 6 in ten years.

3%; average monthly performance rate 52.

8%, an increase of at least 6 percentage points.

Affected by the economic deviation of -59 ppm, EV growth was slightly lower than expected.

The EV is only + 13% from the beginning of the year, mainly due to the economic deviation of -59 ppm due to the decline in the equity market, compared with +3 ppm in 2017.

We expect to achieve more than 15% EV growth in 2019.

Investment is better than peers.

Total investment yield 4.

6% each time -0.

6ppt; Net investment yield 5.

0%, -0.

1 percentage point; comprehensive investment return 3.

7% each time -1.


The total investment yield is highly stable, but the decline in stocks has caused the AFS fair value to drop by $ 5.7 billion, and the decline in comprehensive investment yields has penetrated, but we expect it to be better than its peers.

Non-standard portfolios accounted for 32%, and credit risk was controllable, which effectively improved the overall return on assets. It is estimated to be at a historically low level and continue to pay attention to the company’s merger candidates and business development strategy.

The company’s 杭州桑拿网 CEO announced changes in core functions. Chairman Wan Feng resigned, Li Zongjian acted as chairman and Yang Zheng acted as CEO.

The re-election of the company’s board of directors and its business development strategy deserve attention.

On March 21st, the corresponding 2019E PEV was only 0.

86 times, estimated historical low, given 0.


1x 2019E PEV, corresponding to a reasonable value range of 58.


91 yuan, maintain the investment rating of “preliminary market”.

Risk warning: interest rates are trending downwards; the stock market has grown sharply; protection-type growth has fallen short of expectations.