CMC International: Raises target price for PICC P&C (02328) to HKD 23.6, maintains "buy" rating.

The report released by CMB International stated that PICC P&C (02328) had a strong performance in the third quarter, with net profit increasing by 91.5% year-on-year to 15.8 billion RMB (same below), driving a 50.5% year-on-year increase in net profit to 40.3 billion RMB for the first 9 months, benefiting from improved underwriting profitability and significantly increased investment income. CMB International pointed out that PICC P&C (currently fiscal year 2025) has a P/B ratio of 1.35 times, maintaining a "buy" rating with a target price raised from 21.6 HKD to 23.6 HKD. The bank noted that considering the excellent underwriting and investment performance, the earnings per share forecast for non-life insurance from 2025 to 2027 were raised by 11%, 6%, and 6% respectively to reach 1.86 yuan, 1.94 yuan, and 2.17 yuan, with the annual auto insurance COR forecast revised down to 95.1%, from the previous 95.8%, while the non-auto insurance COR (comprehensive cost ratio) forecast was maintained at 99%, achieving the annual target of COR below 96% and 99%. It is expected that the improvement in the non-auto COR due to the consolidation of the non-auto insurance business will gradually become apparent in 2026.