ZA ONLINE(06060) 国泰君安·2024-03-27 16:00Investment Rating - Maintain "Overweight" rating with a target price of HKD 29.88 per share, corresponding to a 2024 P/B of 2.0x [3] Core Views - The company achieved a turnaround in 2023 with adjusted net profit attributable to shareholders of RMB 294 million, driven by improved investment returns [3] - Premium income grew rapidly, with underwriting profitability remaining stable [3] - Technology output expanded rapidly, and the virtual bank further reduced losses [3] Financial Performance - 2023 net profit attributable to shareholders was RMB 4.078 billion, including a one-time investment gain of RMB 3.784 billion from the conversion of ZhongAn International to a joint venture [3] - Adjusted net profit attributable to shareholders was RMB 294 million, achieving a turnaround due to three factors: 1) slight improvement in underwriting profitability, 2) significant improvement in investment returns, and 3) better exchange rate gains [3] - 2023 premium income reached RMB 29.501 billion, up 24.7% YoY, driven by digital life and health ecosystems [3] - 2023 investment income was RMB 4.961 billion, with adjusted investment income of RMB 1.177 billion, turning from a loss to a profit YoY [3] Business Segments Health Ecosystem - Premium income increased by 9.2% YoY to RMB 9.806 billion, driven by a 23.6% increase in paying users [3] - New premium contribution reached 52%, up 10 percentage points YoY [3] - Underwriting combined ratio improved by 1.4 percentage points to 87.2% [3] Digital Life Ecosystem - Premium income surged 41.6% YoY to RMB 12.563 billion, mainly driven by e-commerce return insurance and travel business [3] - Underwriting combined ratio remained flat at 99.5% [3] Consumer Finance Ecosystem - Premium income grew 22.5% YoY to RMB 5.551 billion [3] - Underwriting combined ratio increased by 6.5 percentage points to 96.4% due to external environmental impacts [3] Auto Ecosystem - Premium income rose 24.7% YoY to RMB 1.580 billion, with new energy vehicle premiums surging 196.1% [3] - Underwriting combined ratio improved by 2.0 percentage points to 97.4% due to significant compression in expense ratio [3] Technology Output and Virtual Bank - Technology output revenue reached RMB 829 million, up 40.0% YoY, with 101 new insurance industry chain clients and 12 new bank and securities clients [3] - ZhongAn Bank's net revenue was HKD 366 million, up 42.9% YoY, with net loss ratio narrowing by 85.6 percentage points to 109.1% [3] Market Data - Current share price: HKD 11.92 [4] - 52-week price range: HKD 11.50-26.55 [5] - Current market capitalization: HKD 17.520 billion [5]