China Pacific Insurance Earnings: New Business Value Gain Exceeds Peers

Following largely in-line results, we maintained our fair value estimate for China Pacific Insurance, or CPIC, at CNY 26 per A share and HKD 30 per H share. With the H share trading at a sharp discount to the A shares, we prefer the H share over the relatively expensive A share. First-half new business value, or NBV, growth increased to 31.5% year on year from 16.6% growth in the first quarter, largely in line with our expectations and likely ahead of peers in our coverage. We appreciate management’s efforts to enhance agent quality and its ability to deliver steady underwriting margins in the P&C insurance business over the past few years.