[ET Net News Agency, 12 June 2018] UBS Global Research trimmed its target price for
Zhong An Online P&C Insurance (06060) to HK$56.8 from HK$76.5, and retained its "neutral"
rating.
The research house said Zhong An's 1Q solvency disclosure suggests underwriting
profitability disappointed. UBS now believes it will take longer to become profitable
(2019, rather than 2018). While growth in premiums is ahead of forecast, the research
house thinks Zhong An's profitability improvement lags its expectations.
Post a 45% decline in its share price from its September 2017 peak, valuation-implied
expectations for its growth have fallen, but remain demanding, UBS said.
UBS believes Zhong An's robust, 98.4%, growth in premiums from January to April was
mainly in the health, consumer finance, and motor segments; however, the quarterly
solvency disclosure implies profitability is still tough.
UBS now expects a net loss of Rmb156m for 2018 and profit of Rmb1.1/2.2bn in 2019/20
(previously it had expected profits of Rmb0.4/1.5/2.8bn for 2018/19/20). (KL)
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06060 ZA ONLINE
Nominal 
9.870 +0.050 (+0.509%) Others
12/06/2018 11:54
[I-bank focus]UBS trims Zhong An Online (06060) to HK$56.8
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