BofAS Cuts AIA TP to HKD95; 1H Results In Line

BofAS published a report stating that AIA (01299.HK) +1.950 (+2.680%) Short selling $452.79M; Ratio 22.583% 's value of new business (VONB) for 1H, based on constant exchange rates, rose 10% YoY to USD3.2 billion, close to the broker's forecast of 11% growth. VONB margin fell from 57.7% to 57.1%. Post-tax operating profit based on constant exchange rates increased 11% YoY. As the company further repurchased shares from April to June, post-tax operating EPS rose 13% YoY, beating expectations. Interim dividend increased 10% YoY to HKD0.539 per share. Embedded value rose 5% HoH to USD80.6 billion.

The broker raised AIA's earnings forecasts for 2025 to 2027 by 3% to 9% to reflect higher investment income. It lowered its 2026 VONB growth forecast from 15% to 11% to reflect slowing growth in Mainland Chinese Visitors (MCVs) business, while maintaining its 2027 to 2028 VONB growth forecast of 16%. The target price was cut by 5% from HKD100 to HKD95, with the Buy rating maintained.

BofAS noted that market focus remains on MCV business. Its base-case assumption is that taxation measures will be implemented gradually over the next one to two years, with manageable impact, but there could still be short-term negative effects on AIA's MCV VONB and group VONB growth. Therefore, the broker lowered its 2026 to 2028 MCV VONB growth forecasts from 20% to 25% to 15%, while average group VONB growth was reduced from 16% to 14%. The broker expects 3Q VONB growth to continue to be affected by the high base in 3Q last year, while the base effect should fade in 4Q. (ad/da)(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2026-08-20 16:25.)