UBS: Raises target price of Chinese property insurance to 18.7 Hong Kong dollars, maintains "buy" rating.

date
05/08/2025
UBS released a research report stating that it is expected that the total premium, automobile premium, and non-automobile premium of Chinese property and casualty insurance companies in the first half of the year will have a year-on-year growth rate similar to that of the first quarter, at 3.6%, 3.4%, and 3.8% respectively. It is also forecasted that insurance income will increase by over 5% in the first half of the year. In terms of underwriting profitability, the bank estimates that the comprehensive cost ratio of companies in the first half of the year will increase by 0.9 percentage points to 95.3%. The automobile comprehensive cost ratio continues to benefit from commission structure adjustments. In terms of non-automobile business, the bank believes that due to improvements in business portfolio, health insurance and agriculture insurance businesses have significantly improved. Therefore, it is estimated that the total underwriting profit in the first half of the year will increase by 29% year-on-year. UBS has raised the post-tax net profit for Chinese property and casualty insurance companies for 2025 to 2027 by 11%, 5%, and 4% to reflect lower-than-expected natural disaster losses and improved stock market performance since the beginning of the year, and has readjusted growth forecasts. The bank has raised the target price for the stock from HK$16.3 to HK$18.7, and reiterated a "buy" rating.