GF Securities recommends "buy": CHINA TAIPING (00966) sees a 221% increase in net profit, dividend doubled by 3.5 times, but valuation is still considered undervalued?

China Taiping (00966) released an annual report that exceeded expectations: in 2025, net profit attributable to the parent company increased by 220.9% year-on-year, and dividend per share soared from HK$0.35 to HK$1.23, an increase of over 250%. GF SEC issued a research report pointing out that the company significantly increased its dividend level, far exceeding market expectations, demonstrating management's confidence in the company's future business solvency. The company took the lead in the transformation to dividend insurance, and the pressure from 26 years of product structure adjustment has been largely absorbed. A valuation of 0.45 times PEV is given according to the EV method, corresponding to a reasonable value of HK$29.34 per share, and a "buy" rating is given. GF SEC believes that behind the explosive performance are two main drivers: first, investment business profit increased by 150% year-on-year, and a 14% reduction in underwriting financial losses significantly improved investment performance; second, tax optimization reduced the tax rate from 42.2% to -9.5%, with a significant amount of tax-free income released forming tax returns. The value side is also solid. New business value (NBV) grew by 5.3% year-on-year, with the new business value rate rising to 21.3%. Embedded value (EV) increased by 19.8% year-on-year, leading in growth compared to peers, with the positive contribution of investment deviation to EV increasing significantly from 1.1% to 8.6%. The company's net assets grew by 33.9% year-on-year, and the balance sheet continued to improve.