Ping An 2318

[winston]

DJ MARKET TALK: Ping An Paying Generously For SDB Stake - CS

1319 [Dow Jones] STOCK CALL: Ping An Insurance (2318.HK) paying "generously" for 30% stake in Shenzhen Development Bank (000001.SZ), says Credit Suisse, though "the scarcity of the asset meant that this was never going to be cheap."

Says Ping An paying 2.2X P/BV for SDB new shares, valuing Newbridge's 17% stake at 2.6X; price tag "full but not alarming." Adds, if this Ping An's last deal over next 18-24 months firm's share price may recover soon, but if this marks start of more buys, shares may fall further on funding concerns.

Keeps Outperform rating, HK$62.00 target; shares down 3.0% at HK$57.25 midday.

[winston]

Waiting for the details. Better than expected ..

*DJ Ping An Insurance 1H Premium Growth Up 30% On Year -Report

[winston]

If you been following the recommendations of the "expert" Analysts, you would have bought a lot of Ping An becuz of the strong performance of the A Shares eventhough they had about 10% Equities only.

Now that the A shares is down 3% now, what are u gonna do ?

[kennynah]

viewtopic.php?f=60&t=76&p=58224#p58224

[winston]

Not vested. From UOBKH:-

Ping An Insurance

July premiums continue to grow at a solid pace
Ping An reported 28% yoy growth in life premiums and 61% yoy growth in P&C premiums. Steady premium growth reinforces our view that Ping An will see strong EV growth this year. Maintain BUY with a target price of HK$76.20.

Corporate Events
Ping An Insurance (Ping An) announced July life insurance premiums of Rmb9.5b, up 28% yoy. Life premiums for 7M09 totalled Rmb82.9b, up 35% yoy. Property and casualty (P&C) premiums for July came in at Rmb3.16b, up 61.4% yoy.

Stock Impact
Life premiums grew at a strong pace in July, which furthers support our view that Ping An will see strong new business value expansion. Ping An’s universal life credit rating was better than peers’ and continued to be a major driver of strong premium growth.

Ping An’s 61% yoy growth in P&C income was mainly driven by strong July auto sales, which were up 63% yoy. Despite the strong pick-up in premium growth, we still believe Ping An’s P&C segment will report underwriting losses for the year on rising claims and cost pressures.

Earnings Risks
Key risks include a sharp fall in the A-share market and a fall in bond yields.

Recommendation
We maintain our BUY recommendation for Ping An as we believe its strong premium growth will continue, largely driven by growth in China’s life insurance industry. We value Ping An Life at Rmb59.41 by using the appraisal method based on 2010 EVPS of Rmb14.01 and 29x NBV (new business value). We value Ping An’s remaining businesses at Rmb7.74 by using the P/B ratio. Using sum-of-the-parts valuation, we derive a target price of HK$76.20. Ping An is due to release its interim results on the night of 14
August.

[winston]

Not vested.

Ping An First-Half Net Drops 45% on Higher Costs (Update1)

Aug. 14 (Bloomberg) -- Ping An Insurance (Group) Co., China’s second-largest insurer, said first-half profit dropped 45 percent, more than analysts expected, as it spent more on commissions, salaries and marketing to boost market share in the world’s most populous nation.

Net income fell to 5.22 billion yuan ($760 million), or 0.71 yuan a share, from 9.49 billion yuan, or 1.29 yuan, a year earlier, the Shenzhen-based company said in a statement to the Hong Kong stock exchange today. The profit, compiled under international accounting standards, fell short of the 7.56 billion-yuan median estimate of three analysts surveyed by Bloomberg.

“This was much worse than we expected,” said Sheng Nan, a Shanghai-based analyst at UOB Kayhian Investment Co. “The intense competition is pushing up expenses. This result will likely have some negative impact on the share price in the near term.”

The company’s shares fell 0.7 percent today in Hong Kong to HK$65 before the results were announced, cutting this year’s gain to 73 percent. Its bigger rival, China Life Insurance Co, which has risen 43 percent this year, will report first-half earnings on Aug. 25.

Ping An, striving to catch up with China Life, said its first-year premium income from individual life insurance rose 36 percent, and the cost of gaining that new business affected short-term profitability.

Market Share

The company said its overall market share of life insurance gross written premiums rose to 16.8 percent at the end of June from 14 percent at the end of December.

Its total net earned premiums in the first half rose 18 percent to 56.8 billion yuan, while China Life reported a 5 percent decline in premium income and China Pacific Insurance (Group) Co. posted a 2 percent drop.

Expenses to support that growth, including employee costs and marketing, surged 70 percent to 11.7 billion yuan in the first half from a year earlier. Ping An expanded the number of bancassurance outlets by 20 percent to 47,934, according to today’s statement.

“As competitors curbed bank-counter sales to improve their product mix, it created an opportunity for Ping An” to boost bancassurance business as the share of bank distribution in its premium income is lower than that of its rivals, Olive Xia of Core Pacific Yamaichi said.

Equity Losses

Overall investment income climbed 58 percent to 14.7 billion yuan in the first half from a year earlier, as 9.5 billion yuan of unrealized losses on its equity investments swung to a gain of 1.96 billion yuan.

Net investment income, which mainly comes from dividends on equities and interest income on bonds and cash deposits, fell by 14 percent to 8.8 billion yuan.

Equity investments rose to 9.6 percent of Ping An’s portfolio at the end of June from 7.8 percent of at the end of 2008, according to today’s statement.

The insurer failed to add enough to its equity investments to take advantage of a 63 percent rally in China’s benchmark Shanghai Composite Index in the first half of 2009, Xia said.

“Like other insurers, Ping An isn’t as aggressive this year as before in boosting their equity holdings” to tap the market rebound after last year’s rout, said Xia, a Shanghai- based analyst.

[winston]

Do u know what you are buying ?

A lot of "expert" Analysts were asking you to buy Ping An becuz of the expected great results, A shares exposure ( although they were underweight Equities ) and their growth story ..

Ping An down 4.5% now. Listen to the "expert" Analysts at your own risk. We tend to buy stuff that we dont really understand

[winston]

From UOBKH on Aug 13, 2009

Recommendation
We maintain our BUY recommendation for Ping An as we believe its strong premium growth will continue, largely driven by growth in China’s life insurance industry.

DJ MARKET TALK: Ping An Down 4.5%; UOB Prefers China Life


1047 [Dow Jones] Ping An (2318.HK) worst-performing blue chip, down 4.5% at HK$62.05 after posting weaker-than-expected 1H results; 50-day moving average at tad below psychological HK$60, likely to act as near-term support. Still, UOB KayHian says "disappointing bottom-line masks strong actuarial numbers;" notes high expenses, increased reserving led to disappointing 1H09 results, which masked strong VNB, embedded value growth.

House expects earnings growth will recover in 2H on low base of 2H08; keeps Buy call, HK$76.20 target price but prefers China Life (2628.HK) due to latter's more defensive mindset, strong business mix which will result in milder swings in reserving. China Life off 3.3% at HK$32.55

[winston]

Volatile A shares temper Ping An outlay

Ping An Insurance (2318) is to keep its equity portfolio at 10 percent to avoid increasing volatility in the A share market, despite having a positive long-term outlook.

Executives from the mainland's second-largest insurer adopted a cautious tone yesterday.

"We will keep the current equity investment but will look for more investment opportunities in other areas such as highly liquid and even commercial property investment if policy allows," chairman Peter Ma Mingzhe said.

President Louis Cheung Chi-yan said equity investment would stay at 10 percent of its portfolio to avoid too much reliance on the domestic stock market.

In the first half, Ping An has already increased its cash level to 14 percent, from 10 percent by the end of 2008, through the sale of low-yield bonds.

Ma also said the insurer is not eyeing other financial institutions.

It will not increase its stake in Shenzhen Development Bank, but will use the relationship to boost profit and get clients.

Last Friday, Ping An said its first-half profit fell 45 percent year-on- year to 5.22 billion yuan (HK$5.91 billion), or 0.71 yuan a share.

Analysts believe its embedded value to be better than expectations. Citi and Credit Suisse yesterday revised their target price up to HK$80 and HK$82, respectively. Citi said Ping An could maintain 20 percent full year net profit growth in 2009. But Credit Suisse downgraded its full year earnings by 14 percent to 1.45 yuan per share, due to its higher than expected tax expenses.

KATHERINE NG, The Standard HK

[winston]

Not vested. From Phillips:-

Risk

The cycle of domestic economy recovery is longer than market expectation;

The unexpected volatility in stock market, leads the losses of the Group's investment.

Valuation
In all, premium incomes of Ping An increased faster than the peers and has the reasonable valuation. We estimate that the value for life insurance of Ping An is about HK$55, coupling with the valuations for property insurance, banking and other aspects, we give Ping An 12-month target price at HK$75.00, around 21% higher than its latest closing price, equivalent to 28 times EPS and 2.9x P/EV in 2010.

We maintain “buy” rating on Ping An.