UBS: Ping An Insurance (02318) expected to see steady growth in operating profit last year, maintaining target price of HK$88.

UBS released a research report saying that Ping An Insurance (02318) plans to announce its performance for 2025 after the market closes on March 26. Calculated on a comparable basis, the bank expects the group's attributable operating profit to increase by 9% year-on-year, meaning a fourth quarter increase of 23% year-on-year. The bank stated that the accelerated growth in the fourth quarter of the group was mainly due to the reduction in impairment losses in the asset management business, and the strengthening of property insurance underwriting profits. UBS made slight adjustments to Ping An's model, but the forecast for attributable net profit to shareholders remains basically unchanged, with a target price of 88 Hong Kong dollars; it maintains a "buy" rating. In terms of the group's attributable net profit to shareholders, UBS expects a 5% year-on-year increase for the full year of 2025; net asset value is expected to increase by 7% year-on-year, implying a moderate seasonal growth in the fourth quarter; the total dividend for the full year of 2025 is expected to be 2.68 RMB per share, a 5% increase year-on-year. In the long term, UBS believes that the total dividend should ultimately grow in sync with the attributable operating profit. UBS also expects the group's new business value to increase by 30% year-on-year for the full year of 2025 compared to traditional products, dividend policies bring lower interest rate risk and profit volatility. The bank believes that Ping An will record a 25% to 30% growth in new business value in the first quarter of 2026; predicts an 18% increase in new business value for the full year of 2026, placing the company at the industry-leading level. UBS believes that Ping An is in a favorable position to capture opportunities for deposit migration and bank-insurance cooperation due to its scale advantages (such as brand, bargaining power with banks) and commitment to expanding bank-insurance channels.