Morgan Stanley: Expects Ping An Insurance (02318) to report stable first quarter performance, supporting mid-term valuation reassessment.

Morgan Stanley released a research report stating that despite market volatility, Ping An Insurance (02318) first quarter performance remains stable and will be conducive to a reevaluation of mid-term valuation. The target price for Ping An Insurance H shares is set at 89 Hong Kong dollars with a "buy" rating, and listed as a top stock pick. The bank expects Ping An Insurance's first quarter after-tax operating profit (OPAT) to increase steadily by 3.6% this year, a faster pace compared to 2.4% in the same period last year. Specifically, OPAT for life insurance business is expected to grow by 4.8% year-on-year, supported by continued growth in assets and relatively stable interest rates. The bank business is expected to see a 2% year-on-year increase in first quarter OPAT, with a potential return to positive growth. Profit from asset management business is expected to increase by 33%, mainly driven by contributions from brokerage services. The bank believes that the group has shown financial resilience in the face of market volatility and is expected to achieve positive Contractual Service Margin (CSM) growth this year, with negative factors related to real estate coming to an end. The group's OPAT growth is expected to reach 8%, 11%, and 11% for the years 2026 to 2028, with operating return on equity (ROE) improving to above 14%.