The two cities of Hong Kong and A finally ushered in a major counteroffensive.
On September 24, the three major A-share indexes rose in volume, with the Shanghai Composite Index rising 4.15% to return to above 2,800 points, the Shenzhen Component Index rising 4.36%, and the ChiNext Index soaring 5.54%. Hong Kong stocks also soared, with the Hang Seng Index surging 4.13%.
As the core of Hong Kong's A market, the big financial sector is naturally also moving on to the wind, with insurance, securities, banks and diversified finance rising sharply across the board. Among them, Ping An's rush in the insurance sector is even more eye-catching, with Ping An A shares rising 5.47% and H shares rising 7.17% today, of which H shares have come out of the ten-day market.
The whole market is inseparable from the big catalyst, and the introduction of blockbuster policies is the fuse of all this, in this context, the market opportunities of insurance companies represented by Ping An have become more and more clear.
01
On a good night, the elephants danced
In the singing and laughing of the global general rise, the market has been bitter for a long time.
Now, the introduction of a series of favorable policies has pushed the market to usher in a reversal.
On September 24, the Information Office of the State Council held a press conference, revealing multiple favorable policies under the heavy voice.
The most direct impact on the market is the following five:
The RRR will be cut by 0.5 percentage points in the near future. Another 0.25-0.5 percentage point rate cut is likely before the end of the year.
The central bank's policy interest rate will be lowered by 0.2 percentage points from the current 1.7% to 1.5%, guiding the loan prime rate (LPR) and deposit interest rate to fall simultaneously, and keeping the net interest margin of commercial banks stable.
Create new monetary policy tools to support the stable development of the stock market.
Reducing the interest rate on existing housing loans and guiding commercial banks to reduce the interest rate on existing housing loans to around the interest rate on new housing loans, the average decline is expected to be about 0.5 percentage points.
The minimum down payment ratio for second home loans at the national level will be lowered from 25% to 15%, and the minimum down payment ratio for housing loans will be unified.
This month, the Federal Reserve cut interest rates by 50 bps, which put a break in this ultra-long interest rate hike cycle and provided a more accommodative environment for major economies around the world to cut interest rates. Previously, the European Central Bank, England, Canada and Sweden and other central banks have cut interest rates to varying degrees.
The announcement of the central bank of the mainland to cut the reserve requirement ratio and interest rates is in line with the market's development expectations for the follow-up monetary policy trend, and is expected to release long-term liquidity of about 1 trillion yuan and create a more abundant capital environment for the market. More importantly, the central bank will also take the opportunity to reduce the reserve requirement ratio to further alleviate the liquidity problem, depending on the market liquidity situation during the year.
In addition, there is also a "precise living water" injection into the stock market, that is, the creation of securities, funds, insurance companies swap facilities and special refinancing for stock repurchase and holdings.
The former is to encourage insurance companies, securities companies, and funds to purchase stocks, and use them as pledges to obtain high-liquidity assets such as treasury bonds and central bank bills from the central bank.
This kind of asset is of high quality in terms of credit rating and liquidity, which can greatly improve the ability of relevant institutions to obtain funds and increase their stock holdings, and the funds obtained by institutions through this tool can only be used to invest in the stock market, and the positive circulation effect is highlighted. The scale of the first phase of the operation of the swap facility is 500 billion yuan, and there may be a second or even a third 500 billion yuan in the future.
It is worth mentioning that this press conference mentioned the private securities investment fund jointly established by Chinese Life and New China Life, and said that it will support other qualified insurance institutions to set up similar funds in the future. As the policy level continues to create a favorable environment and expand insurance patient capital, it is also bringing new opportunities to insurance companies.
The latter is to guide banks to provide loans to listed companies and major shareholders, and the funds can only be used to buy back and increase their holdings of listed companies' shares.
The ability for companies and major shareholders to access capital at a low cost and buy their own shares directly in the market can help stabilize the company's stock price and boost investor confidence.
For example, if a listed company has a dividend yield of 6%, the cost of obtaining funds through share buybacks, increased holdings and refinancing is 2.25%, which is undoubtedly a profitable deal.
Through this set of big moves, we can see that the central bank's determination and strength to boost the stock market is unprecedented, and the core of market stability lies in financial stability, which is also the key to today's capital surge in finance.
In addition, at this meeting, Pan Gongsheng, governor of the central bank, said that at present, the treasury yield curve, as an important price signal, still has problems such as insufficient remote pricing and insufficient stability. The central bank's risk warning on long-term treasury bond yields is to curb the herd effect, prevent long-term treasury bond yields from falling unilaterally, and maintain a good trading order in the bond market. In the context of interest rate cuts, the policy environment of interest rates has also provided conditions for financial institutions such as insurance companies to operate steadily.
Standing at the moment to tap the opportunities of big finance, if you talk about stability, insurance > banks > brokers; In terms of flexibility, brokerages > insurance > banks. In general, insurance is more cost-effective in terms of overall value. In particular, high-dividend insurance companies like Ping An are more likely to become the first choice for funds.
Looking at the down payment reduction, it is undoubtedly directly beneficial to real estate sales and helps to reduce the risk exposure of insurance companies to real estate investment.
In addition, lowering the interest rate on existing loans will help reduce residents' debt pressure and increase their willingness to spend. As of the end of June 2024, the balance of personal housing loans in China was 37.8 trillion yuan. Every 1 point reduction in the interest rate of existing loans can release more than 300 billion purchasing power, and this data will only be even larger when combined with the increase in consumption propensity brought about by the expected improvement.
As one of the optional consumption, insurance consumption will undoubtedly benefit from the overall improvement of residents' willingness and ability to consume.
Overall, the economic recovery and the recovery of the capital market have jointly provided a guarantee for the business expansion and investment income of insurance companies, and the insurance industry is ushering in the resonance of the asset side and the liability side.
China Merchants Securities Research Report believes that with the triple catalysis of the stock market, real estate and interest rates on the asset side, the constraints on the profit performance and stock price valuation of the life insurance sector are expected to be fully opened.
Standing at the current node, the insurance sector has become a key point that cannot be ignored.
Today's surge in insurance stocks represented by Ping An shows the market's strong confidence and expectation in insurance stocks.
However, it is undeniable that after the transformation and transformation of the industry, the differentiation of the insurance industry is becoming more and more intense, and the competitive landscape is becoming increasingly complex.
In this context, if the fog is cleared, what are the characteristics of those companies that can really continue to lead the market?
Ping An may be a sample that deserves to be focused on and studied repeatedly.
02
Rolling stones up the mountain, hard and blameless
In ancient Greece, Sisyphus constantly pushed the "boulder" up the mountain, and although the slope was too steep, the boulder would roll back to its original place, but he still continued the cycle and never stopped.
Looking back at Ping An's development history, it has had a deep iteration of strategy every decade, and in this process, Ping An is full of challenges and difficulties, just like Sisyphus pushing a boulder up the mountain.
However, with continuous evolution and innovation, Ping An has finally achieved leapfrog development again and again.
The continuous outline of the "J-curve" has also become a confirmation of Ping An's continuous transformation.
In other words, although Ping An may encounter certain operating pressure in the early stage of reform and transformation, with the gradual implementation of reform measures and market adaptation, it will quickly rebound and enter a new stage of higher growth.
Entering 2024, Ping An continues to deliver outstanding results.
According to previous data, in the first eight months of this year, Ping An achieved a total premium income of 620.706 billion yuan, a record high for the same period in history, and the year-on-year growth rate expanded from 0.29% in February to 7.64% in August.
Matching the premium income is the outstanding performance of a series of core indicators, which deeply explains the effectiveness of Ping An's reform.
While Ping An Life and Health Insurance has experienced a significant downsizing in the size of its agents, this shift has resulted in significant improvements in the quality and efficiency of its business.
According to the data, the per capita new business value of Ping An's life insurance agents has steadily climbed from 56,791 yuan per person per year in 2019 to 90,285 yuan per person per year in 2023. At the same time, the average monthly income of agents has also increased from 6,309 yuan in 2019 to 9,813 yuan in 2023.
Today, the number of Ping An agents has stabilized, and the price difference between the per capita new business value and the number of agents curve is still expanding, which also indicates that Ping An is moving towards a more refined and efficient development direction, and the optimization and upgrading of agent channels is bringing higher business value and market competitiveness to the company.
It is not difficult to see that after the in-depth adjustment of reform, Ping An has ushered in the dawn.
The continued high growth trend also means that after experiencing the short-term pressure brought about by the reform, Ping An is starting a new round of growth. And the internal strength of continuous cultivation has also made the growth of Ping An more breakthrough and explosive at this time.
As Ma Mingzhe, chairman of Ping An of China, wrote in his speech in the semi-annual report. "Only by accumulating strength halfway can we climb the slope and cross the hurdle; Take advantage of the momentum and sail to break the waves. ”
Ping An's road of "rolling stones up the mountain" is full of challenges, but every step is solid and powerful, and with the continuous improvement of the external environment, Ping An has stood on a new starting point.
03
Stir up the new time, ride the wind and waves
While the achievements of reform continue to be realized, the deeper value growth charm of Ping An lies in the in-depth evolution of its strategy.
Peter ·, known as the "father of modern management", once said about the relationship between efficiency and effectiveness: efficiency is "doing things the right way", and efficiency is "doing the right thing". For enterprises, it is performance, not efficiency, that is indispensable.
If the life insurance reform represents Ping An's measures to improve efficiency, then the strategic layout around "comprehensive finance + medical and pension" shows Ping An's far-reaching vision of pursuing efficiency, which not only focuses on the way of implementation, but also pays attention to the correctness of business direction and the accuracy of market positioning.
It can be said that this strategy is an important measure for Ping An to comply with the high-quality development trend of the insurance industry, which goes beyond simple efficiency improvement, and more importantly, it is constantly stimulating new impetus for the company's growth and pushing Ping An into a new stage of growth.
Looking back at each decade of Ping An, its strategic transformation and innovative development at different historical stages have profoundly reflected its keen insight into market changes and accurate grasp of future trends.
From the first decade, from business development from scratch, to the second decade, to the service-driven practice of integrated finance, and then to the third decade, to start technology-driven, and gradually explore the 'finance + technology' strategy.
Now in its fourth decade, Ping An is continuing to promote the strategy of "integrated finance + medical care for the elderly" driven by demand, and continues to release its flywheel effect.
In the new strategic stage, Ping An takes ecology as the starting point and deeply anchors the high-quality development of the industry. By building a customer-centric ecosystem, Ping An has achieved deep business integration and maximized value.
In terms of integrated finance, Ping An provides customers with one-stop financial services by integrating its banking, insurance, securities, trust and other financial sectors.
In terms of medical care for the elderly, Ping An has been actively deploying and providing customers with full life cycle services from health management, disease prevention to elderly care by building a medical and elderly care ecosystem to meet the growing market demand.
Through Ping An's semi-annual report, it is not difficult to see that its medical and elderly care ecosystem is accelerating the release of growth value and becoming a strong engine driving the company's development.
In the first half of 2024, 28.6% of Ping An's new customers came from the medical and elderly care ecosystem, and the customers who enjoyed the service rights and interests of the Group's medical and elderly care ecosystem covered more than 68% of the new business value of life insurance.
As of the end of June, more than 63% of Ping An's 236 million individual customers had used the services provided by the medical and elderly care ecosystem, with an average of about 3.36 contracts and an average AUM of about 57,500 yuan, which were 1.6 times and 3.8 times that of individual customers who did not use the services of the medical and elderly care ecosystem, respectively.
It can be said that Ping An's development strategy has already changed from a traditional financial service provider to a leading international integrated financial and medical and health service provider. Through the promotion of the "comprehensive finance + medical pension" strategy, Ping An not only plays an important role in serving the national strategy, serving social needs and serving people's livelihood, but also continuously consolidates and expands its leading position in the market.
With the increasing demand for financial services and medical and elderly care services, Ping An's future development prospects are becoming more and more exciting.
At a deeper level, the evolution of the strategic model implies the revaluation of the business value of the enterprise, and with the continuous improvement of the efficiency verified at the performance level, Ping An's market performance is also expected to bring more imagination.
04
epilogue
In the long river of the insurance industry, Ping An is like a light boat, steadily walking out of the throes of transformation and smoothly crossing thousands of mountains.
Now, as the industry enters a new moment of "capital liability" resonance, the potential of Ping An's value is ushering in an important inflection point of accelerated release.
In the warm wind of policies, with its steady operation and strategic upgrading, Ping An has demonstrated the dual charm of "growth and stability", which is in line with the ideal target portrait of the current market institutions.
At a time when confidence is more precious than gold, Ping An's strategic model evolution and business value revaluation potential will make a positive contribution to the entire insurance industry and even the country's economic transformation and development.
As Ping An continues to work hard in the fields of integrated finance, medical care and elderly care, it will be able to ride the wind and waves and create more value and miracles on the road of future development.