The Zhitong Finance App learned that CICC released a research report stating that maintaining Prudential's (02378) “outperforming the industry” rating and target price of HK$151.35 corresponds to the 2026 and 2027 forecasts of P/EV of 1.2 times and 1.0 times, respectively. There is 52% room for growth compared to the current stock price. The bank kept the company's profit forecast unchanged. Prudential's new business profit (NBP) for the third quarter of 2026 increased 1% year over year based on actual exchange rate (AER) and fixed exchange rate (CER). In the first three quarters, NBP increased 7% and 6% year over year based on actual exchange rate and fixed exchange rate, respectively, which is basically in line with market expectations; the profit margin of new business increased 3 percentage points to 44% year on year in the third quarter.
CICC's main views are as follows:
Steady growth in Hong Kong, China
In the third quarter of 2026, Prudential Hong Kong still achieved double-digit year-on-year growth in NBP under a high base for the same period last year, mainly due to better business demand from local customers and improved profit margins in banking insurance channels. The company said that NBP is expected to achieve double-digit growth throughout the year. The bank recommended continuing to monitor the impact of mainland visitors' insurance policy taxation on mainland China visitors' business.
New business in the mainland China market is under year-on-year pressure
In the third quarter of 2026, CITIC Prudential Life's NBP declined sharply year-on-year, mainly due to banking insurance channel fee control and the high sales base brought about by the reduction in scheduled interest rates in the third quarter of 2025. The profit margin for new businesses in the third quarter of 2026 was over 40%, an improvement over the first half of the year.
The company said that the new annualized premiums achieved good growth from September to October 2026, or supported the positive year-on-year growth of NBP in the fourth quarter, and that NBP for the whole year may drop 10% to 15% year over year. The bank believes that under the 2026 low base, CITIC Prudential Life's NBP may return to positive year-on-year growth in 2027.
Other markets continue previous trends
In the third quarter of 2026, Prudential Malaysia, Indonesia, Singapore and other markets achieved double-digit growth, slight decline, and double-digit growth, respectively, year-on-year, and basically continued the previous trend. Among them, the share of the investment and insurance business in the Singapore market increased, driving the profit margin of new businesses to increase, partially offsetting the impact of the year-on-year decline in new annualized premiums.
The growth rate was restored from September to October, and the annual repurchase target of 1.5 billion US dollars is expected to be achieved
In the third quarter and the first three quarters of 2026, after excluding the mainland China market, NBP increased by 13% and 11%, respectively. The company said that the Group's NBP growth momentum improved from September to October, but the rate of improvement in mainland China lagged behind, making it more difficult to achieve the Group's NBP double-digit growth target for the whole year compared to expectations for the first half of 2026.
In the first three quarters of 2026, the company's cumulative repurchases reached $1 billion. The company said that the annual repurchase target of 1.5 billion US dollars is expected to be achieved, including a basic repurchase plan of 1.2 billion US dollars and an additional repurchase of 300 million US dollars in the medium term.
Risk Alerts
New premiums fall short of expectations; US bond interest rate fluctuations; overseas financial risk events; regulatory uncertainty.