AIA Group 1299

[winston]

AIA’s first-quarter new business value rises 31%, announces US$2 billion buyback

Hong Kong-based insurer AIA Group on Monday posted a 31 per cent rise in its first-quarter value of new business (VONB) on a constant exchange currency basis and announced an additional US$2 billion share buyback.

AIA’s VONB, which gauges expected profits from new premiums and is a key barometer for future growth, came in at US$1.33 billion in the three months ending March 31 compared with US$1.05 billion a year ago.

Source: REUTERS

https://www.businesstimes.com.sg/compan ... on-buyback

[winston]

vested

1Q Results

VONB: +31%; US$1.3b

US$2.0 billion addition to existing share buy-back programme, bringing the total to US$12.0 billion

https://www1.hkexnews.hk/listedco/listc ... 900001.pdf

[winston]

vested

AIA Group
What is ‘very strong’?

We forecast 32% 1Q24F VONB growth (AIA-provided consensus is 19%), driven by HK (>35% growth)/ China (>30% growth) strength.

We see very strong HK sequential growth off a high 4Q23 base (which is a seasonally high quarter) as setting the stage for strong 1Q24F yoy growth.

Reiterate Add. TP unchanged at HK$95. AIA is still our sector top pick.

Source: CIMB

https://rfs.cgsi.com/api/download?file= ... 4A846BCBCF

[winston]

vested

AIA Group (1299 HK)
Strong VONB Beat In 1Q24 With Enhanced Capital Management Plan

AIA’s 1Q24 VONB came in above our estimate with a 31% yoy growth, driven by a 26%
growth in ANP and margin recovery in the Greater China business.

AIA announced its enhanced capital management policy — adding US$2.0b to the existing share
repurchase programme and bringing total shareholder return to 8.4%.

Maintain BUY with a higher target price of HK$95.00.

With upside surprise from 1Q24 VONB growth and shareholder returns, we expect valuation re-rating to persist in the near term.

Source: UOBKH

https://research.uobkayhian.com/content ... e=hs_email

[winston]

Focus on dividends, not buybacks

We expect AIA’s DPS to deliver 10% CAGR over FY23-26F and estimate annual net FSG less its dividend of ~US$0.1bn-0.2bn over FY24F-26F.

We thus do not see much room for any sizeable buybacks in FY25F after its Apr US$2bn buyback increase, unless AIA’s leverage ratio is raised.

This is due to constraints from its 75% target of annual net FSG plus its target of total capital resources comfortably exceeding 200% of required capital.

We see a possible US$5.8bn buyback after end-FY25F, if AIA’s leverage ratio rises 6% pts to 20%. Reiterate Add rating and TP of HK$95.

Source: CIMB

https://rfs.cgsi.com/api/download?file= ... 202D5E4DDA

[winston]

not vested

<Research>BOCOMI Trims AIA (01299.HK) TP to $84, Reflecting Lower Mkt Valuation

BOCOMI released a research report keeping rating at Buy on AIA (01299.HK).

However, BOCOMI updated its forecasts based on the new accounting standards.

Considering the lowered market valuation, BOCOMI trimmed its target price for AIA from $103 to $84.

AIA's value of new business (VONB) maintained strong growth momentum over 2023 and 1Q24, according to the report.

The strong growth in Hong Kong and mainland China markets are expected to be sustainable.

At the same time, the Company also focused on delivering sustainable shareholder returns, and proposed clearer plans for capital management and shareholder returns.

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/news/ ... -news/AAFN

[winston]

vested

<Research>UBS: AIA Commits to Complete Current Buyback Target; MCV Demand Remains Robust

AIA (01299.HK) committed to complete its current buyback targets at the UBS Asian Investment Conference, UBS released a research report saying.

AIA said that it will return 75% of its net free surplus generation for the year to shareholders through dividend and buyback.

In addition, AIA also disclosed that agency recruitment in both domestic and Mainland Chinese visitor (MCV) segments is progressing well, and MCV insurance demand remains robust.

With regard to the regulatory risk of capital flow, AIA said that MCV premium are very small compared to China as a whole, and that MCV premium is paid mainly from Hong Kong bank accounts.

UBS currently rated AIA at Buy, with a target price of $96.

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/news/ ... -news/AAFN

[winston]

vested

<Research>G Sachs Reaffirms AIA (01299.HK) Key Strength Lies in Ability to Deliver Both Shareholder Returns, Long-term Profit Growth

Goldman Sachs recently met with the investor relations team of AIA (01299.HK).

AIA explained the headwinds to underlying free surplus in 2022/23, and expected underlying free surplus to be driven by future new business and value-in-force (VIF) growth.

Goldman Sachs reiterated that AIA's key strength lies in its ability to deliver shareholder returns and long-term earnings growth.

Based on the base case scenario of the Company's additional US$2 billion share buyback in FY2025/26, it is estimated that the Company's operating profit after tax will grow at 10% per annum from FY2024 to FY2026.

Goldman Sachs kept rating on AIA at Buy, and listed the Company on Conviction List Buy, with a target price of $98.

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/news/ ... -news/AAFN

[winston]

vested

<Research>G Sachs Expects AIA (01299.HK) 2Q VONB to Rise 17% YoY at CER Basis


The 22% cumulative decline in AIA (01299.HK) 's share price since 20 May evaporated the Company's gains since the announcement of its capital management policy and the expansion of its share buyback program in April, according to Goldman Sachs.

It is believed that this situation reflects the decline in the HSI and investors' continuous concerns about the rebound in earnings and the growth in embedded value (EV) and VONB.

Related News: M Stanley Cuts TP of AIA (01299.HK) to $86, Expects 1H24 VONB Growth Stable

Goldman Sachs forecasted that AIA's 2Q24 VONB will increase by 17%/ 15% YoY at constant exchange rate (CER) and actual exchange rate (AER) each, while profit after tax growth for the interim period will turn positive, with a 2% YoY rise.

Goldman Sachs will focus on 2H24 outlook of AIA's management.

Goldman Sachs reiterated rating at Buy on AIA, and listed the Company in Conviction List Buy, based on the Company's solid VONB growth, strong balance sheet and earnings generation.
Goldman Sachs' target price for AIA is $92, equivalent to 9x projected VONB for 2025.

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/news/ ... -news/AAFN

[winston]

vested

At an operating profit growth turning point

We expect 1H24F OPAT per share growth of 6% (CER) and forecast 1H24F OPAT to be flat yoy on an actual exchange rate basis.

We see 1H24F OPAT at near-bottom and forecast 2H24F OPAT to rebound 6% yoy, before returning to double-digit growth in FY25F–26F.

This is driven by a more marked pick-up in CSM growth in 2H24F and FY25F–26F, with potential additional tailwinds if US$ also starts to weaken.

FY24F-26F EPS cut by 2%, with TP cut by 1% to HK$94 as we mark-to market for investment and forex market volatility. Reiterate Add rating.

Source: CIMB

https://rfs.cgsi.com/api/download?file= ... A031F4C881