China Life (LFC): Insured gains?

"China Life Insurance (NYSE: LFC), China’s largest life insurer based on premiums, is once again on our 'buy' list," says China expert Jim Trippon in The China Stock Digest.

"Shares of China Life have slipped slightly in the volatility surrounding large cap ADRs despite an excellent pro?t report from the company.

"Frst-half net pro?t rose 29% from a year earlier. That’s an impressive gain, considering the continuing pressure on the Chinese economy from unemployment and falling exports. 

"The company’s net pro?t for the six months ending June 30 rose to just over two billion dollars from $1.57 billion a year earlier, according to Chinese accounting standards. Applying international accounting standards brings the proportional gain down to a 15% increase in pro?ts. 

"China’s rising stock markets more than compensated for a slide in group insurance policies. Its gains on ?nancial assets, which re?ect China Life’s returns from the stock market, rose sixteen-fold to $1.741 billion.

"The company says it intends to continue to invest in Chinese equities despite losses that hurt the ?rm’s capital base during the peak of the global ?nancial crisis last year. We recommend purchase up to $65 a share."