On February 3, Ping An of China released its 2020 annual report: In 2020, the company achieved revenue of 1.32 trillion, a year-on-year increase of 3.8%; net profit attributable to the parent company was 143.099 billion, a year-on-year decrease of 4.2%!

After 12 years, Ping An’s net profit dropped again, which can be called the darkest moment of performance!

At the performance conference on February 4, Ma Mingzhe said not a word!

In the past two years, Ping An has seen frequent changes in its senior management. In 2020, Ma Mingzhe resigned as CEO!

Behind the frequent changes in the company's top management, the performance of the pillar business of life insurance is worrying, and the number of agents continues to decline, which has not achieved the company's so-called reform effect!

Excluding the impact of the epidemic, Ping An's performance is also very weak!

Just as "Stock Theory" predicted "financial worries due to a sharp decline in the number of agents" when interpreting Ping An's 2019 annual report, it has now been verified!

1. Weak performance!

Ping An's net profit fell in 2020, mainly due to the decline in net profits from its life insurance and property and casualty insurance businesses.

In 2020, the net profit of the life and health insurance business was 96.072 billion, a year-on-year decrease of 7.4%; the net profit of the property and casualty insurance business was 16.159 billion, a year-on-year decrease of 29.2%.

In terms of insurance capital investment, in 2020, the investment return rate of China's Ping An Insurance Fund Investment Portfolio was affected by factors such as stock market fluctuations and falling market interest rates. It achieved a net investment return rate of 5.1% and a total investment return rate of 6.2%, respectively.

fell by 0.1 and 0.7 percentage points.

At the end of December 2019, Ping An's insurance fund investment portfolio reached 3.74 trillion yuan, an increase of 16.6% from the beginning of the year.

In the insurance fund investment portfolio, bond investment increased from 46.9% at the end of 2019 to 50.2% at the end of 2020; stock investment dropped from 9.2% at the end of 2019 to 8.4% at the end of 2020.

Although the investment rate of return has declined, the investment scale has increased significantly, and the total investment income has still increased!

Net investment income in 2020 was 163.462 billion yuan, a year-on-year increase of 13.5%, and total investment income was 199.636 billion yuan, a year-on-year increase of 4.4%.

, the net profit of the banking business was 16.777 billion, a year-on-year increase of 2.59%; the technology business net profit was 7.936 billion, a year-on-year increase of 127.59%. The technology business is outstanding and has become the company's third largest source of profit after insurance and banking!

However, the overall net profit of the technology business is still small, accounting for only 5.54% of the company's net profit. In addition, it remains to be seen whether the technology business can sustain high growth!

2. The life insurance business is worrying!

Life insurance business is the foundation of Ping An of China, with life insurance business accounting for 67% of its net profit!

The value of new business is the inlet of the life insurance business and also a leading indicator of profits. A sharp decline in the value of new business will have a profound impact on the entire life insurance business!

If the new business value cannot resume rising in the later period, the operating profit of life insurance may face negative growth!

In 2020, the new business value was 49.5 billion, a year-on-year decrease of 34.7%, and the new business value rate was 33.3%, a year-on-year decrease of 14 percentage points!

In fact, the growth rate of new business value has been declining since 2016, and suddenly collapsed in 2020.

From 2016 to 2020, the new business value growth rates were 64%, 32%, 7%, 5% and -34% respectively.

The growth rate of new business value in the past three years has entered a stage of stagnation and decline. Correspondingly, the first-year premium of new business value has experienced negative growth for three consecutive years.