Rating One: China Life's 2025 performance is expected to grow steadily, with undervalued valuation presenting a recovery opportunity.

On the evening of March 25, China Life Insurance released its 2025 annual report, achieving total operating revenue of 615.6 billion yuan, a year-on-year increase of 16.5%; net profit attributable to shareholders was 154 billion yuan, up 44.1% year-on-year. The “Yipin Rating” by First Financial believes that the company’s performance in 2025 maintained steady growth, generally in line with market expectations, with potential for valuation recovery in the future.

According to “Yipin Rating” analysis, the development trend of the company’s core insurance services remains stable. In 2025, the company’s insurance service revenue grew by 2.9% year-on-year, showing a good trend of quarter-by-quarter improvement, with growth rates consistent with the overall industry level. This aligns with market expectations that the growth rate of personal insurance premiums will remain in a low range of 0–5% for the long term. The company’s main business development is in line with industry trends, and its operational foundation is solid.

“Yipin Rating” found that investment performance became the main driver of the company’s profit growth in 2025, significantly boosting profitability. In 2025, the company’s total investment performance reached 387.694 billion yuan, an increase of 25.7% year-on-year. Among them, bond interest income remained stable, while bond trading profits were slightly lower than in 2024. Equity investment returns saw a substantial increase, mainly due to two factors: on one hand, the proportion of equity investments steadily increased, reaching 22.6% in 2025, up from 19% in 2024; on the other hand, the excellent performance of the A-share market last year drove up equity investment results.

“Yipin Rating” believes that China Life’s main business is growing steadily at a low speed, with a solid foundation; coupled with the continued positive development of the domestic capital market, the investment side is expected to continue contributing incremental profits to the company. In the medium to long term, it is recommended to actively monitor the company’s valuation recovery opportunities. According to the “Yipin Rating” evaluation system, China Life’s growth potential is rated 1.5 stars, profitability trend 2.5 stars, industry pattern 3 stars, and moat 3.5 stars. The “Yipin Rating” valuation model indicates the company’s intrinsic value is 1.5053 trillion yuan.

(This article is from First Financial)