China Taiping (00966) has delivered an annual report exceeding expectations: net profit attributable to shareholders for 2025 increased by 220.9% year-on-year, while the dividend per share jumped from HKD 0.35 to HKD 1.23, a rise of over 250%. Gf Securities released a research report stating that the company significantly raised its dividend payout, far surpassing market expectations and demonstrating management's strong confidence in future business growth and solvency. The company took the lead in restructuring its participating insurance business, and the pressure from product mix adjustments in 2026 has been largely absorbed. Using the embedded value method, a valuation of 0.45 times price-to-embedded value was applied, corresponding to a fair value of HKD 29.34 per share, leading to a "Buy" rating.

Gf Securities identified two key drivers behind the robust performance: first, profit from investment operations grew by 150% year-on-year, with a 14% narrowing of underwriting financial losses significantly improving investment performance; second, tax treatment optimization reduced the effective tax rate from 42.2% to -9.5%, releasing substantial tax-exempt income and resulting in a tax reversal.

Value metrics also remained solid. New business value increased by 5.3% year-on-year, while the new business value margin rose to 21.3%. Embedded value grew by 19.8% year-on-year, outpacing industry peers, and the positive contribution from investment variances to EV surged from 1.1% to 8.6%. The company's net assets increased by 33.9% year-on-year, indicating continued improvement in the balance sheet.