UOB Kay Hian Cuts AIA TP to HKD100, Reiterates Buy; Expects 2Q VONB to Rise 13% YoY
I'm LongbridgeAI, I can summarize articles.UOB Kay Hian cut AIA's target price to HKD100 and reiterated a Buy rating, citing potential overreaction to mainland China's crackdown on cross-border capital. The broker expects Q2 VONB growth to slow to 13% YoY due to high base effects, revising down forecasts for 2026-2028 and operating profit. Despite lower net investment income projections, the firm believes depressed valuations may attract long-term investors if AIA maintains VONB momentum.
Mainland China has launched a large-scale crackdown on cross-border capital activities since late May, targeting illegal cross-border securities trading and capital outflows, while for the first time bringing individuals under the regulatory framework for outbound investment. In a report, UOB Kay Hian said the market may have overreacted to the potential impact of the new measures on AIA (01299.HK) -1.300 (-1.764%) Short selling $142.99M; Ratio 16.335% 's Mainland Chinese Visitor (MCV) business. Under its base-case scenario, the broker does not expect a comprehensive ban, although some degree of tightening is possible. The current depressed valuation may attract some long-term investors. If AIA can maintain VONB growth momentum in mainland China and other ASEAN markets, and provide greater clarity on MCV sales, the upcoming interim results could become an important catalyst for valuation re-rating.
Due to the high comparison base in mainland China and Hong Kong, the broker expects second-quarter Value of New Business (VONB) growth to slow to 13% YoY, while 1H VONB is forecast to rise 15% YoY. The broker lowered its VONB forecasts for 2026-2028 by 3.5%, 1.8% and 3.6%, respectively, reflecting downward revisions to Hong Kong market forecasts, and also cut its forecast for operating profit after tax this year by 2.4% to reflect lower net investment income projections. It maintained the Buy rating and reduced the TP from HKD109 to HKD100. (da/u)(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2026-07-09 12:25.)