Goldman Sachs released a report stating that the bank recently met with the investor relations team of AIA Group (01299.HK) and explained the unfavorable factors facing the company's basic free earnings in 2022/23. It is expected that the basic free earnings will be driven by the growth of future new businesses and effective business value (VIF). In addition, as the company continues to repurchase shares, AIA stresses that the return per share should continue to exceed the growth of overall operating profit and free earnings.
The bank reiterated that AIA's main advantage lies in its ability to achieve shareholder returns and long-term profit growth. Based on the company's basic scenario of repurchasing $2 billion of shares in the 2025/26 fiscal year, it is estimated that the company's after-tax operating surplus will grow at an annual rate of 10% in the fiscal years from 2024 to 2026. AIA is rated as a "buy" and included in the conviction buy list, with a target price of 98 yuan.