20080827-Everbright Research-China Life Insurance (2628.HK)

China Life Insurance reported a 32% net profit decline in 1H08,
due to market-to-market losses in the deep downturn in equity
markets of Hong Kong and the mainland. Net profit dropped to
RMB15.8bn. EPS was RMB0.56 without interim dividend. The
results were slightly better than the market consensus. We
have revised down FY08 and FY09 earnings projections by
22.9% and 11.6% respectively. The current valuation of 24.9x
2008 forward PER and 2.11x P/EV is not demanding. Maintain
“Accumulate” rating with a target price of HK$30.00 (previously
HK$31.00), equivalent to 26.2x forward PER and 2.23x P/EV.