[ET Net News Agency, 22 November 2017] Nomura lifted its target price for PICC Group
(01339) to HK$5.4 from HK$4.84, and maintained its "buy" rating.
The research house said PICC Group's life business was improving, with NBV up +76% for
1H: (1) regular premium as % of total first year premium improved from 11% in 1H 2016 to
20% in 1H 2017; (2) the low-margin bancassurance business FYP decreased -18% y-y, while
the higher-margin individual business FYP grows +6% y-y in 1H.
But Nomura said PICC would benefit from the improving outlook for the P&C sector, given
extremely strict regulatory measures pushing the expense ratio lower since July 2017,
while PICC would gain market share from smaller players.
As such, the research house decreased its combined ratio forecast further by 0.2pp for
FY2017-19. It expects the decline in PICC's expense ratio will be more than the increase
in loss ratio for 2H, implying an improving FY2017 compared with FY2016 in terms of
combined ratio. (KL)
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01339 PICC GROUP
Nominal 
3.190 +0.030 (+0.949%) Others
22/11/2017 13:58
[I-bank focus]Nomura lifts PICC Group (01339) to HK$5.4
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