Morgan Stanley released a research report announcing a reduction in the target price for PICC GROUP (01339) H-shares from HK$8.4 to HK$7.7, while maintaining an "Overweight" rating. The new target corresponds to a projected 2026 price-to-book ratio of 0.9 times.

Following the group's 2025 fiscal year results, the firm has lowered its forecasts for PICC GROUP's shareholder attributable net profit from the life insurance business for 2026 and 2027 by 13.5% and 15.8%, respectively. This adjustment primarily reflects the life insurance segment's underperformance relative to expectations last year. Forecasts for the property & casualty and health insurance businesses remain largely unchanged. Consequently, the group-level shareholder attributable net profit and earnings per share forecasts have been reduced by 6.4% and 6.7%.

The report suggests that the property & casualty business should maintain its competitive market position, with relaxed regulations for non-auto insurance lines expected to benefit underwriting performance. The health insurance segment is experiencing strong growth and has potential for further revaluation. Meanwhile, the life insurance business is actively working to improve its operational quality to catch up with industry peers.