[ET Net News Agency, 24 July 2020] Morgan Stanley raised its target price for China
Pacific Insurance (CPIC)(02601) to HK$34 from HK$27 and maintained its "overweight"
rating.
The research house said CPIC struggled to generate VNB (value of new business) growth
for two consecutive years with VNB up only 2% in 2018 and down 9% in 2019, partly a base
issue and partly affected by management changes at the life unit.
The company is still facing growth headwinds for 2020 with 11% VNB decline expected.
CPIC has risen 28% since its March lows, underperforming life peers slightly.
Although near-term performance could continue to lag peers, with a prudent balance
sheet, quality-focused strategy, better governance, and a 6.3% 2020 dividend yield, Morgan
believes the company is still an attractive financial stock to own over the long term.
(KL)