China Life Insurance Company Limited

OTCPK:LFCH.Y Stock Report

Market Cap: US$101.6b

This company listing is no longer active

This company may still be operating, however this listing is no longer active. Find out why through their latest events.

China Life Insurance Future Growth

Future criteria checks 2/6

China Life Insurance is forecast to grow earnings and revenue by 18.5% and 3.5% per annum respectively. EPS is expected to grow by 20.5% per annum. Return on equity is forecast to be 13.7% in 3 years.

Key information

18.5%

Earnings growth rate

20.51%

EPS growth rate

Insurance earnings growth2.2%
Revenue growth rate3.5%
Future return on equity13.72%
Analyst coverage

Good

Last updatedn/a

Recent future growth updates

Recent updates

Seeking Alpha Aug 25

China Life Insurance reports 1H results

China Life Insurance press release (NYSE:LFC): 1H Net profit of RMB25.42B Revenue of RMB516.67B. Gross written premiums were RMB439.97B
Seeking Alpha Aug 02

China Life Insurance President resigns, new President appointed

China Life Insurance (NYSE:LFC) announced that due to the adjustment of work arrangements, Mr. Su Hengxuan tendered his resignation as the President, an Executive Director and a member of the Strategy and Assets and Liabilities Management Committee of the company on Aug. 1, 2022. He had no disagreement with the board and there are no other matters relating to his resignation. Mr. Zhao Peng was appointed as the President of the company and nominated as an Executive Director of the board. Most recently, he served as VP, Agricultural Development Bank of China.
Seeking Alpha Jul 15

China Life Insurance: Fundamentals Remain Intact

Fundamentals are still strong for this large life insurance company. China should offer growth for this industry, as the demand is there. Valuation is still attractive at today's price level. Investment thesis My last article on China Life Insurance Company Limited (LFC) back in March this year came with a Buy call on the company, as I concluded that it offered good value at that time. If you had bought the shares at that time, you could take some comfort in knowing that your book value would now be down by just roughly 3% against a backdrop of the S&P500 going down more than 16% China Life Insurance versus SPY (SA) Alpha is alpha – even if the return is negative, which brings me to my last article on Blackrock’s China A-share ETF (CNYA), where I pointed out that it looks to me that China at this moment offers better prospects of improved return as opposed to Europe and to a lesser extent also the U.S. The reason for this you will find in that article. Back to China Life, perhaps as an alternative to buying the ETF CNYA one could use China Life as a good proxy for exposure to China. Recent development We will only get the interim financial report for 2022 around the 25th of August this year. However, we do have an indication of how some of the top lines for the first half of this year have fared, as they have reported accumulated premium income from 1st January to 30st June of 2022 and it came in at RMB 439.7 billion. This is slightly lower than the first half of 2020 when they recorded RMB 442.3 billion in premium. It should be expected, as the lockdown in the first half of this year may have put a damper on growth in premiums. More and more of their customers do now sign on for insurance online, but there are still those that prefer to sit down with a person in a branch office. Something which was hard to do due to Covid-19 restrictions. In the last few weeks, the central government has reduced quarantine times and eased some Covid-19 prevention measures. However, we do see that in different parts of China there has been a rise in new cases. But things are hopefully changing for the better. Consultancy firm Oliver Wyman predicted in a report published in March this year that China’s life insurance premiums are expected to surpass the U.S. market and become the world’s largest market by 2030. Annuity and endowment products presently only cover about RMB 30 trillion, which is much lower than the population’s expected pension needs. This highlights the gap and opportunities for insurers like LFC. A side note on investor activism LFC is among the largest shareholders in two of the largest position in my portfolio. These are HSBC (HSBC) and Hui Xian REIT, which is listed in Hong Kong under 8700.HK and controlled by CK Asset Holding (CHKGF). With regards to Hui Xian REIT, I have recently written to the board of directors and explained to them that it is not in the shareholder's interest that the company issues new units to settle distribution and management fees now that they are trading at a discount to NAV of 75%. Over the last ten years, they have added more than one billion new units, diluting the share count with 22.3% additional units without adding any productive assets to the balance sheet. As a matter of fact, they should be buying back and canceling shares at this point in time. So far, I have not received any response from Hui Xian REIT. My next step will be to reach out to LFC, and other shareholders, with the aim of getting their support for my request to Hui Xian REIT of terminating the issuance of new units at this moment. Hopefully, they can see the merits of my request and will want to take action. Risk to the thesis Under the leadership of Xi Jinping, China wants to make sure that the difference between the rich and poor, which is huge in China, should be addressed. That is not a bad thing.
Seeking Alpha Mar 29

China Life Insurance: Continues To Offer Good Value

China Life's valuation is very attractive based on financial fundamentals. Share price has gone further down since my last buy call. We look at 2021 fiscal year results and revisit the investment thesis.
Seeking Alpha Dec 16

China Life Insurance: One Year Cash Flow Greater Than Its Value

Fundamentals of China Life Insurance are good. Valuation is very attractive. Risks lie in the unknown things like liabilities in the accounts and further limitations to profit from future regulations.
Seeking Alpha Aug 06

China Life Insurance Company Limited: Risky, But Upside Potentially Significant

The life insurance industry in China could see strong growth in the decade ahead. This stock could see significant exposure to risk in a low interest rate environment. However, should earnings growth remain solid, then I see potentially strong upside.

Earnings and Revenue Growth Forecasts

OTCPK:LFCH.Y - Analysts future estimates and past financials data (CNY Millions)
DateRevenueEarningsFree Cash FlowCash from OpAvg. No. Analysts
12/31/2024655,53359,145N/A265,84411
12/31/2023629,80151,192N/A263,14213
12/31/2022613,11337,908N/A267,66813
9/30/2022771,14633,552324,779328,830N/A
6/30/2022775,60335,369326,225330,812N/A
3/31/2022767,00437,514294,615299,556N/A
12/31/2021794,69150,921280,973286,448N/A
9/30/2021808,45151,464305,515311,474N/A
6/30/2021810,36160,690313,081319,547N/A
3/31/2021809,79761,551333,143339,939N/A
12/31/2020778,86350,056296,550304,019N/A
9/30/2020774,71147,269307,616317,570N/A
6/30/2020758,84650,628306,754318,534N/A
3/31/2020722,12048,949288,231299,576N/A
12/31/2019689,16657,893274,617286,032N/A
9/30/2019665,55948,844263,525278,499N/A
6/30/2019632,87132,187238,631253,670N/A
3/31/2019639,16523,527217,525236,535N/A
12/31/2018518,79411,011128,006147,552N/A
9/30/2018527,25824,91784,09197,634N/A
6/30/2018534,22136,05488,886102,270N/A
3/31/2018518,23439,242107,844117,791N/A
12/31/2017555,72731,873191,371200,990N/A
9/30/2017542,14832,038247,583257,159N/A
6/30/2017515,89520,588237,716245,170N/A
3/31/2017512,37019,639188,220194,725N/A
12/31/2016472,61118,74183,78889,098N/A
9/30/2016458,88814,205-53,562-44,594N/A
6/30/2016426,04913,420N/A-56,939N/A
3/31/2016443,14727,494N/A-18,849N/A
12/31/2015402,55234,514N/A-18,811N/A

Analyst Future Growth Forecasts

Earnings vs Savings Rate: LFCH.Y's forecast earnings growth (18.5% per year) is above the savings rate (2%).

Earnings vs Market: LFCH.Y's earnings (18.5% per year) are forecast to grow faster than the US market (14.9% per year).

High Growth Earnings: LFCH.Y's earnings are forecast to grow, but not significantly.

Revenue vs Market: LFCH.Y's revenue (3.5% per year) is forecast to grow slower than the US market (8.1% per year).

High Growth Revenue: LFCH.Y's revenue (3.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: LFCH.Y's Return on Equity is forecast to be low in 3 years time (13.7%).


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Company Analysis and Financial Data Status

DataLast Updated (UTC time)
Company Analysis2022/11/12 18:40
End of Day Share Price 2022/11/10 00:00
Earnings2022/09/30
Annual Earnings2021/12/31

Data Sources

The data used in our company analysis is from S&P Global Market Intelligence LLC. The following data is used in our analysis model to generate this report. Data is normalised which can introduce a delay from the source being available.

PackageDataTimeframeExample US Source *
Company Financials10 years
  • Income statement
  • Cash flow statement
  • Balance sheet
Analyst Consensus Estimates+3 years
  • Forecast financials
  • Analyst price targets
Market Prices30 years
  • Stock prices
  • Dividends, Splits and Actions
Ownership10 years
  • Top shareholders
  • Insider trading
Management10 years
  • Leadership team
  • Board of directors
Key Developments10 years
  • Company announcements

* Example for US securities, for non-US equivalent regulatory forms and sources are used.

Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more.

Analysis Model and Snowflake

Details of the analysis model used to generate this report is available on our Github page, we also have guides on how to use our reports and tutorials on Youtube.

Learn about the world class team who designed and built the Simply Wall St analysis model.

Industry and Sector Metrics

Our industry and section metrics are calculated every 6 hours by Simply Wall St, details of our process are available on Github.

Analyst Sources

China Life Insurance Company Limited is covered by 39 analysts. 22 of those analysts submitted the estimates of revenue or earnings used as inputs to our report. Analysts submissions are updated throughout the day.

AnalystInstitution
Mark William KellockBarclays
Tianjiao YuBernstein
Michael LiBofA Global Research