China Life Insurance (CHINA LIFE) reported better-than-expected 9M25 results. Net profit attributable to shareholders reached RMB167.8 billion, up 60.5% YoY, while net assets stood at RMB625.8 billion, rising 22.8% from the beginning of the year. New Business Value (NBV) grew 41.8% YoY (comparable basis), and total premiums increased 10.1% YoY to RMB669.65 billion, with new premiums up 10.4% YoY to RMB218 billion. The investment yield improved by 1.04 percentage points to 6.42%.

**Strong Profit Growth Driven by Investments** In 9M25, net profit surged 60.5% YoY to RMB167.8 billion, with Q3 alone hitting a record RMB126.87 billion (+91.5% YoY). This was supported by favorable market conditions and strategic asset allocation, as investment income soared 454% YoY to RMB137.1 billion. The company also reduced insurance service expenses by 20.3%, further boosting profitability.

**NBV Growth Accelerates on Premium Recovery and Product Mix Optimization** NBV rose 41.8% YoY, driven by a rebound in new premium growth (+10.4% YoY vs. +0.6% in 1H25). The product structure continued to improve, with life, annuity, and health insurance accounting for 31.95%, 32.47%, and 31.15% of new premiums, respectively. Variable-charge products now represent over 45% of first-year renewal premiums, reflecting a more diversified and balanced business portfolio.

**Steady Net Asset Growth and Solvency Ratios** Net assets increased 19.5% QoQ, partly due to liability releases from rising interest rates (RMB68.27 billion gain in 9M25 vs. RMB39.4 billion loss in 1H25), offsetting bond valuation pressures (RMB95.58 billion OCI loss in 9M25). Core and comprehensive solvency ratios remained stable at 137.5% and 183.94%, respectively.

**Investment Recommendation: Maintain Strong Buy** China Life’s NBV and profit growth exceeded expectations, with robust net asset expansion indicating sound asset-liability management. Continued recovery in equity markets and dividend insurance sales should sustain performance. Forecasts for 2025–2027 include net profits of RMB178.7 billion (+67.1% YoY), RMB181.5 billion (+1.5%), and RMB184.7 billion (+1.8%), and NBV of RMB46.9 billion (+39.3%), RMB51.2 billion (+9.1%), and RMB54.4 billion (+6.3%). Current valuations imply 2025E–2027E P/EV of 0.75x, 0.67x, and 0.60x.

**Risks**: Equity market volatility, weaker-than-expected dividend insurance sales, and interest rate fluctuations.