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AIA Group (SEHK:1299) has drawn investor attention after its latest reported figures showed revenue of $25,490m and net income of $6,056m, prompting fresh questions about how the insurer’s current valuation lines up with its fundamentals.
See our latest analysis for AIA Group.
Despite the latest figures, AIA Group’s recent trading has been softer, with a 1 day share price return of a 4.18% decline and a year to date share price return of a 3.60% decline. However, the 1 year total shareholder return of 46.55% points to stronger momentum over a longer stretch.
If this has you thinking about where else returns could be building, it might be worth checking out our screener of 103 top founder-led companies to surface fresh ideas beyond large insurers.
With AIA trading below some estimated value measures and recent returns mixed, the key question now is whether the current price reflects a discount or whether the market is already incorporating expectations of future growth.
AIA Group’s latest fair value narrative comes in at HK$99.80 versus the last close of HK$80.30, setting up a clear valuation gap for investors to unpack.
The company’s focus on high-value protection and low-guarantee fee-based products (now nearly 90% of new business) has resulted in resilient, predictable cash flows and strong margins, supporting sustainable earnings and embedded value growth; this positions AIA defensively against interest rate volatility and market cycles, underpinning profitability.
Curious what sits behind that confidence in cash flow and margins? The narrative leans on layered earnings, disciplined capital use, and a higher future profit multiple. The key question is how these factors interact at a 6.9% discount rate. Want to see which assumptions really drive that HK$99.80 fair value estimate?
Result: Fair Value of HK$99.80 (UNDERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, this hinges on robust new business and stable regulation, and slower growth or tighter rules in key Asian markets could quickly challenge that positive valuation narrative.
Find out about the key risks to this AIA Group narrative.
That 19.5% undervaluation story leans on future cash flows, but the current P/E of 17.8x tells a different story. It sits above the Asian insurance industry on 12x, above the fair ratio of 11.4x, yet below peers at 28.5x. Is that a margin of safety, or valuation risk building?
