Quam Securities Research

Quam Securities

Equity Bottom-Up

<h2>ZhongAn Online (6060 HK)</h2>
<h3>FY20 underwriting breakeven</h3>
<p>Results comment</p>
<p><strong>ZhongAn reported FY20 GWP of RMB16.7bn (+14.2% y/y) and attributable profit of RMB554mn, in line with our expectations and narrowly missing consensus estimates.  The underwriting breakeven was primarily driven by strong performance in health ecosystem coupled with streamlined cost structure. We continue to expect its ecosystem strategy, technological and product mix innovation to drive earnings and share price appreciation. Its</strong>…</p>

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<h2>ZhongAn Online (Buy; PT: HK$52; +30%)</h2>
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<h3>Insurtech kingpin</h3>
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<p><strong>ZhongAn has proven its ability to take advantage of the structurally higher demand for its health products, ecosystem strategy, business mix optimization and cost discipline. Following its share price rally by 43% since our initiation report published on 26 May 2020, its shares are currently trading at 3.6x 2021E P/B. We maintain our Buy rating and TP of HK$52.</strong></p>
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<p><strong>Company description<br></strong>ZhongAn Online P&amp;C Insurance (“ZhongAn”), one…</p>
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China

ZhongAn Online P & C Insurance Co., Ltd. operates as an insurance company. The Company develops and sells health, airline, and automotive insurance, and other products. ZhongAn Online P & C Insurance also offers online consumer finance services.