HK Stock Market Move | The increase in non-life insurance stocks has further expanded. Insurance companies in the third quarter achieved higher-than-expected growth on a high base. It is expected that the high growth trend will continue in the fourth quarter.

The gains of domestic insurance stocks further expanded. As of the time of publication, China Life Insurance (02628) rose by 4.62% to HK$25.84; New China Life Insurance (01336) rose by 4.59% to HK$50.65; Ping An Insurance (02318) rose by 3.02% to HK$57.95; PICC P&C (02328) rose by 2.6% to HK$18.91. Huachuang Securities pointed out that listed insurance companies achieved higher-than-expected growth in net profit attributable to equity holders in the third quarter of 2025 on a high base. The quarterly growth rates of net profit attributable to equity holders were as follows: China Life +92%, New China Life +88%, PICC +49%, Ping An +45%, and Taiping +35%. Under the new regulations, the impact of stock market fluctuations on performance is still significant. In the short to medium term, the asset side is still the core logic. If the equity market maintains its current activity level, insurance companies are still expected to maintain the current high growth trend in the fourth quarter of 2025 and for the whole year, with a positive outlook for the insurance sector's strong beta characteristics. In the long term, benefiting from dynamic adjustments of interest rates, the integration of reporting and banking, and the transformation of dividend insurance, we believe that the "interest rate spread loss" pressure of listed insurance companies has gradually converged, and the improvement in operating quality on the liability side may gradually drive valuation repair. Industrial Securities pointed out that in the short term, benefiting from the high prosperity of the equity market, the net profit of the insurance sector in the fourth quarter is expected to continue to grow rapidly. In the medium to long term, the value revaluation logic prompted by this round of interest rate spread disruption will continue. On one hand, the bottoming out of long-term interest rates combined with the increase in equity allocation brings about investment "efficiency"; on the other hand, the transformation of dividend insurance combined with the downward adjustment of fixed interest rates and the integration of reporting and banking drives the "cost reduction" of liabilities. The ongoing repair of the interest rate spread brought about by the resonance of the two ends is a process rather than a completion, and the insurance sector, especially undervalued Hong Kong-listed insurance companies, present a good opportunity for allocation.