The Zhitong Finance App learned that UBS released a research report stating that it covered Fuwei Group (01828) for the first time and gave it a “neutral” rating, with a target price of HK$32. Established in 2013, FW is a life insurance company focusing on the Asian market. It operates in 10 markets, with core markets in Hong Kong, Thailand and Japan.
The report points out that the Asian insurance market is structurally attractive, driven by widening coverage gaps, the potential for deposit migration driven by wealth creation, and policy support. Fuwei has advantages such as low base growth, technological flexibility, and exclusive cooperation with major banks. From 2025 to 2030, it predicts that the compound annual growth rate of new business value and operating profit after tax will reach 12% and 16%, respectively. However, the Group is highly dependent on third-party channels (such as brokerage), contributing 78% of new business value in 2025. Related channels have high regulatory risks, fierce commission competition and management complexity. Building a high-quality agency team takes time, and faces challenges such as slowing labor trends, recruitment restrictions, and competition in emerging occupations.
According to UBS, FW Group's implied value in 2025 is only equivalent to 8.9% of AIA (01299). As a young and smaller company, FWD is equipped to learn from the success of market leaders, while being more flexible in execution and able to select business opportunities more selectively. However, the bank expects FWare's compound annual growth rate of new business value from 2025 to 2030 to be lower than AIA's 15%. The main reasons include: 1) AIA has geographical expansion opportunities in China; and 2) FW's broker-based business model faces high regulatory risks.