In a report released yesterday, Nika MA from CMB International Securities maintained a Buy rating on AIA Group (AAIGF – Research Report), with a price target of HK$94.00.
Nika MA has given his Buy rating due to a combination of factors that highlight AIA Group’s strong financial performance and potential for shareholder returns. AIA Group has demonstrated resilient growth in its Value of New Business (VNB), which is expected to increase by 20% on a constant exchange rate basis in FY24, despite a slowdown in the second half of the year. This growth is driven by key markets such as Hong Kong and mainland China, with expectations of continued positive performance in other regions like India and Vietnam.
Nika MA also notes the company’s solid operational performance, with an anticipated 7% year-over-year increase in operating profit after tax (OPAT), supported by improved insurance services and investment results. The completion of a significant share buyback program further underscores AIA’s focus on enhancing shareholder value, with total shareholder returns projected to reach approximately 8% in FY24. The stock’s valuation, trading at a lower price-to-embedded value ratio compared to historical averages, presents an attractive opportunity for investors, reinforcing the Buy recommendation.
In another report released on February 12, Morgan Stanley also maintained a Buy rating on the stock with a HK$91.00 price target.