CMB International Securities analyst Nika MA maintained a Buy rating on ZhongAn Online P & C Insurance Co., Ltd (1ZO – Research Report) yesterday and set a price target of HK$16.00.
Nika MA has given his Buy rating due to a combination of factors that highlight ZhongAn Online P & C Insurance Co., Ltd’s strong financial performance and promising future prospects. The company reported a significant increase in net profit for FY24, more than doubling from the previous year, which exceeded both the firm’s and Bloomberg’s expectations. This was largely driven by steady profit growth in their insurance segment, a successful turnaround in their technology export business, and a reduction in losses at ZA Bank.
Looking forward, Nika MA anticipates that ZhongAn will benefit from the growing domestic AI market, which will enhance its Insur-Tech offerings and potentially lead to a re-rating of its stock. Additionally, the expected breakeven of ZA Bank in FY25 is seen as a major catalyst for further valuation growth. The analyst has adjusted the valuation method to account for the rapid growth in the tech export and banking segments, setting a new target price of HK$16.0, which reflects a positive outlook for the company’s stock.
MA covers the Financial sector, focusing on stocks such as AIA Group, Ping An Insurance Company of China, and China Life Insurance Co. According to TipRanks, MA has an average return of 14.3% and a 68.42% success rate on recommended stocks.
In another report released on March 20, DBS also reiterated a Buy rating on the stock with a HK$21.20 price target.