GTHT released a research report stating that short-term personnel changes at PICC P&C (02328) will not alter its long-term stable business strategy, expressing optimism about sustained improvements in underwriting profitability. The firm maintains its EPS forecasts for 2025-2027 at RMB 2.14, 2.40, and 2.55, respectively, and keeps the 2025 P/B ratio at 1.6x, reiterating a target price of HK$22.82. GTHT expects the company's core operations to remain steady despite temporary leadership adjustments, citing clear strategic planning for auto and non-auto insurance as key drivers for continued underwriting profit growth. The "Overweight" rating is upheld.

Key points from GTHT's analysis include:

1. **Interim Leadership Appointment Ensures Operational Stability** On December 9, PICC P&C announced the appointment of Mr. Zhang Daoming as interim head, responsible for overall operations. With 27 years of management experience in the insurance sector, Mr. Zhang has long been involved in the company's operations. This follows the resignation of former executive director and president Yu Ze due to personal reasons. GTHT believes these changes will not disrupt the company's strategic focus on deepening reforms and innovation under its "first-class enterprise" vision, anticipating stable performance in core segments like auto and non-auto insurance.

2. **Clear Strategy Supports Long-Term Premium and Profit Growth** - **Auto Insurance**: PICC P&C's underwriting profitability is expected to strengthen further, supported by optimized business structures and cost controls, leading to stable margins. - **Non-Auto Insurance**: Regulatory measures, including the "compliance in reporting and execution" policy effective November 2025, are likely to enhance underwriting profits. As a market leader, PICC P&C has proactively aligned with these requirements, such as developing industry-standard products for emerging risks and initiating non-auto insurance reforms. - **Overseas Expansion**: The company is actively building overseas operations targeting "Chinese enterprises" and "Chinese products," with 618 projects underwriting BRI initiatives in the first three quarters of 2025. New energy vehicle insurance has also been launched in Hong Kong and Thailand, positioning overseas growth as a new premium driver.

**Catalyst**: Potential upside from stronger-than-expected recovery in equity markets. **Risks**: Frequent catastrophic events; declining long-term interest rates; equity market volatility.