External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Equity Bottom-Up

PICC Property & Casualty / Equity Bottom-Up

<ul><li>PICC P&amp;C reported 1Q26 results, with net profit down 23.7% YoY to RMB8.63bn, slightly below market estimates; while the combined ratio (COR) was down 0.3pct YoY to 94.2%, better-than-expected, thanks to continued improvements in both auto and non-auto COR.</li><li>The decline of net profit was due to investment headwinds, which caused the insurer’s total investment income to drop 38.4% YoY to RMB4.6bn, and total investment yield fell to 0.7% (unannualized, vs. 1Q25: 1.2%).</li><li>Underwriting profit and net investment results accounted for 70.7%/46.5% of pre-tax income in 1Q26, vs. 49.2%/56.2% in 1Q25. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

PICC P&amp;C reported 1Q26 results, with net profit down 23.7% YoY to RMB8.63bn, slightly below market estimates; while the combined ratio (COR) was down 0.3pct YoY to 94.2%, better-than-expected, thanks to continued improvements in both auto and non-auto COR.The decline of net profit was due to investment headwinds, which caused the insurer’s total investment income to drop 38.4% YoY to RMB4.6bn, and total investment yield fell to 0.7% (unannualized, vs. 1Q25: 1.2%).Underwriting profit and net investment results accounted for 70.7%/46.5% of pre-tax income in 1Q26, vs. 49.2%/56.2% in 1Q25. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

PICC P&C (2328 HK) - Underwriting Resilience Persists Despite Investment Headwinds

Research and consultancy, Tabbush Report

Daniel Tabbush

Research and consultancy

Tabbush Report

We provide research and consultancy on Asian banks. Our focus is on what we call “Asian bank research, without the noise.” We are interested in the most critical swing-factors for banks, the NPL and credit cycle, and where we believe there is a gap between perception and reality. We often focus on the less studied components of bank financial statements.  Our research is highly thematic, sometimes examining unlisted banks and companies as a window on mainstream banks. 

Being independent allows us to look at smaller banks, often overlooked by others. Analysis of BIS bank guidelines in the context of Asia, is also a focal point, while we also analyze global banks operating in the region. We use what we believe is the most comprehensive, reliable financials database, SNL Financial. S&P Capital IQ augments our database, with corporate data and CEIC, with economics. 

Asian bank research, without the noise.

<ul>
<li>The new excitement of the MS&amp;AD story is the company's commitment to sell down all of its cross-shareholdings and to use proceeds to fund growth and dividends. </li>
<li>ROE is already far higher now than in recent years, and this can continue with rising dividends. </li>
<li>Monthly insurance sales figures give a good window on the core business, with growth rates in May YoY and YTD accelerating.</li>
</ul>


The new excitement of the MS&amp;AD story is the company's commitment to sell down all of its cross-shareholdings and to use proceeds to fund growth and dividends. 
ROE is already far higher now than in recent years, and this can continue with rising dividends. 
Monthly insurance sales figures give a good window on the core business, with growth rates in May YoY and YTD accelerating.


MS&AD Insurance - Sell Stocks to Zero; Drive Growth, Dividends. HFD on Policy Sales, Accelerating

<ul><li>PICC P&amp;C reported FY25 results, with net profit rising 25.5% YoY to RMB40.4bn, slightly below our estimate of RMB41.3bn (link), as 2H net profit growth eased to 16.3% YoY (1H25: +32.3%).</li><li>UW profit surged 1.19x YoY to RMB12.5bn thanks to significantly reduced UW losses in 2H on top of a high base.</li><li>CoR was 97.5% as of year-end, improving 1.3pct YoY, with auto/non-auto CoR at 95.3%/100.8%, down 1.5pct/1.0pct YoY, meeting/missing mgmt. guidance of &lt;96%/&lt;100%. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

PICC P&amp;C reported FY25 results, with net profit rising 25.5% YoY to RMB40.4bn, slightly below our estimate of RMB41.3bn (link), as 2H net profit growth eased to 16.3% YoY (1H25: +32.3%).UW profit surged 1.19x YoY to RMB12.5bn thanks to significantly reduced UW losses in 2H on top of a high base.CoR was 97.5% as of year-end, improving 1.3pct YoY, with auto/non-auto CoR at 95.3%/100.8%, down 1.5pct/1.0pct YoY, meeting/missing mgmt. guidance of &lt;96%/&lt;100%. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

PICC P&C (2328 HK) - Non-Auto CoR Sees Headroom for Improvement

Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

Cross Asset Strategy

<ul>
<li>Hong Kong market quietly broke its downward trend channel last week, however the HSI met strong resistance at 18200 (100 Week Moving Average).</li>
<li>
<a href="https://www.smartkarma.com/entities/picc-property-casualty-h" target="_blank" data-smartkarma-citation="entities:350:1" rel="noopener">PICC Property &amp; Casualty H (2328 HK)</a> and <a href="https://www.smartkarma.com/entities/china-petroleum-chemical-h" target="_blank" data-smartkarma-citation="entities:369:1" rel="noopener">China Petroleum &amp; Chemical (386 HK)</a> broke to new highs relative to MSCI indices.  Sinopec may benefit from stronger RMB in 2H24.
</li>
<li><a href="https://www.smartkarma.com/entities/shenzhou-intl-group-holdings-ltd" target="_blank" data-smartkarma-citation="entities:10415:1" rel="noopener">Shenzhou Intl Group Holdings (2313 HK)</a> had a short-term turnaround from its downtrend.  The company reported growth in sales and better margins in 2Q24.</li>
</ul>


Hong Kong market quietly broke its downward trend channel last week, however the HSI met strong resistance at 18200 (100 Week Moving Average).

PICC Property &amp; Casualty H (2328 HK) and China Petroleum &amp; Chemical (386 HK) broke to new highs relative to MSCI indices.  Sinopec may benefit from stronger RMB in 2H24.

Shenzhou Intl Group Holdings (2313 HK) had a short-term turnaround from its downtrend.  The company reported growth in sales and better margins in 2Q24.


Technically Speaking, Breakouts and Breakdowns: HONG KONG (SEPTEMBER 3)

Asset Allocation & Fund Positioning, Copley Fund Research

Steven Holden

Asset Allocation & Fund Positioning

Copley Fund Research

Copley Fund Research provide research and data on asset allocation among Global and Emerging Market equity funds.  The analysis details absolute and relative positioning across countries, sectors and industries together with highly granular data on single stock and single fund allocations.  The data is updated monthly with time series going back to January 2011.

Global Research - Analysis of 165 prominent Global equity funds, combined AUM $335bn
GEM Research - Analysis of 127 prominent global EM equity funds, combined AUM $250bn

Asset Allocation - Global and GEM Equity

<ul>
<li>Industrials and Consumer Staples Remain Top Overweights, Though Sentiment Fragile for Both.</li>
<li>Energy sector shows signs of a turnaround from long-term decline, whilst Financials remain unloved by China investors.</li>
<li>Real Estate allocations have hit record lows, with average holdings at just 2.93%, while Consumer Discretionary sector approaches all-time highs.</li>
</ul>


Industrials and Consumer Staples Remain Top Overweights, Though Sentiment Fragile for Both.
Energy sector shows signs of a turnaround from long-term decline, whilst Financials remain unloved by China investors.
Real Estate allocations have hit record lows, with average holdings at just 2.93%, while Consumer Discretionary sector approaches all-time highs.


China

PICC Property & Casualty is the largest non-life insurance company in mainland China, providing a broad range of property and casualty insurance products. Its offerings include motor vehicle, commercial property, cargo, liability, accidental injury and health, agriculture, credit, surety, and homeowners insurance. The company also offers reinsurance and insurance agency services. It is headquartered in Beijing, China, and was incorporated in 2003.

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PICC Property & Casualty (2328 HK)

PICC P&C (2328 HK) - Underwriting Resilience Persists Despite Investment Headwinds

PICC P&C reported 1Q26 results, with net profit down 23.7% YoY to RMB8.63bn, slightly below market estimates; while the combined ratio (COR) was...

CMB International

MS&AD Insurance - Sell Stocks to Zero; Drive Growth, Dividends. HFD on Policy Sales, Accelerating

MS&AD commits to sell down its cross-shareholding to zero, proceeds to fund growth, dividends. Core insurance sales improving, with April and May...

Daniel Tabbush

PICC P&C (2328 HK) - Non-Auto CoR Sees Headroom for Improvement

PICC P&C reported FY25 results, with net profit rising 25.5% YoY to RMB40.4bn, slightly below our estimate of RMB41.3bn (link), as 2H net profit...

CMB International

Technically Speaking, Breakouts and Breakdowns: HONG KONG (SEPTEMBER 3)

Hong Kong market broke its downtrend however it met strong resistance just above 18k. PICC and Sinopec broke to new highs relative to MSCI...

David Mudd

China Macro: Sector Positioning Update

Sector positioning among active China Funds. Industrials and Consumer Staples Remain Top Overweights, Energy shows signs of a turnaround, whilst...

Steven Holden

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