Bank of America Securities released a research report stating that it has upgraded china pacific insurance (02601) from "neutral" to "buy." The company's goal is to maintain stable growth in dividends per share, while also reflecting profit growth. Therefore, it is expected that the company will have a very high possibility of offering a higher dividend per share, although the bank anticipates that the payout ratio will only be 25 to 30%, which is on the lower end of market expectations, the dividend yield will still exceed 5%.
The bank recently held a conference call with China Pacific Insurance, believing that under the changes in product strategy, it will sell more participating products, while still dominating in savings products. It is believed that there is potential for an increase in the new business value profit margin next year, with expected profit margins for protection-type products reaching 70% to 80%, and for savings and participating products reaching 10% to 20%.
Bank of America Securities mentioned that, like most of its peers, china pacific insurance has not yet decided on its dividend policy for 2024, mainly due to the sudden increase in net income. On the other hand, due to fluctuations in the stock market, the profit performance in the fourth quarter of 2024 is still unclear, and it is expected that the company will not provide further clarification on its dividend policy before February next year.
