UBS has issued a research report expressing a positive outlook for AIA's (01299) medium-term prospects, anticipating mid-teens growth in new business value and a total shareholder return of 4%. The firm has maintained its "Buy" rating on the stock. Driven by a shift in business mix, capital efficiency has improved, leading to a 23% increase in new business value from new business investments in 2025. However, due to macroeconomic headwinds stemming from the Iran conflict, including weak equity markets, rising US interest rates, and a stronger US dollar, UBS has lowered its forecasts for 2026 net profit and embedded value by 8% and 3%, respectively. Consequently, the target price has been reduced from HK$106 to HK$104.

Management highlighted that the growth momentum in the Hong Kong business remained strong in the first quarter of 2026, driven by both local Hong Kong customers and mainland Chinese visitors. The appreciation of the Renminbi has had a limited impact on demand from mainland visitors, attributed to structural demand for wealth diversification and the attractiveness of Hong Kong's insurance products. In mainland China, benefiting from contributions from both agency and bancassurance channels, new business value recorded growth exceeding 20% in the first two months of the year. For the Thailand business, due to a high base effect from a co-payment scheme implemented at the end of March last year, new business value is expected to decline year-on-year in the first quarter.

The report noted that AIA has addressed investor concerns regarding topics such as artificial intelligence, the Iran conflict, and private credit. Regarding AI, a company survey indicated that 85% of respondents prefer purchasing insurance from a trusted advisor, with only 2% favoring a purely digital model. In practice, AI has already delivered tangible benefits, with over 49% of new business value from agents in 2025 originating from digital leads. Concerning the Iran conflict, the company has no direct exposure, and its exposure to the Middle East region is minimal. Private credit funds represent only 2.2% of non-participating and surplus assets, of which over 60% are senior secured direct loans, with no investments in funds specifically focused on AI, software, or the technology sector.