Talanx AG: Risk Reward Update

Research evidence excerpt

Talanx AG: Risk Reward Update

UpdateM

Risk Reward – Talanx AG (TLXGn.DE)

KEY EARNINGS INPUTS

Drivers 2025 2026e 2027e 2028e

Industrial Combined Ratio (%) 90.3 90.3 90.3 90.3

Retail Germany Combined Ratio (%) 91.8 91.1 91.1 91.1

Retail International Combined Ratio

92.0 91.0 90.7 90.5

(%)

Reinsurnace Combined Ratio (%) 86.2 87.9 88.3 88.3

INVESTMENT DRIVERS RISKS TO PT/RATING MS ESTIMATES VS. CONSENSUS

Commercial pricing RISKS TO UPSIDE FY Dec 2026e

Free float Reacceleration of commercial rate 2,712 M&A activity environment, driving further Industrial Lines Net income

2,700 2,898

margin expansion (€, mn)

2,761

GLOBAL REVENUE EXPOSURE Recovery in German economic outlook

Further accretive M&A activity

0-10% MEA 4.25

APAC, ex Japan, Mainland RISKS TO DOWNSIDE DPS 10-20% 3.90 4.45 China and India Commercial lines pricing decelerating faster (€)

10-20% Latin America than expected/inflationary pressures/economic 4.14

10-20% UK slowdown

20-30% North America Reinsurance lines rate declines limiting growth 10.50

30-40% Europe ex UK and margins EPS 10.46 11.22 (€)

Source: Morgan Stanley Research Estimate Poor M&A activity 10.69

View explanation of regional hierarchies here Germany outlook deteriorating

Mean Morgan Stanley Estimates

OWNERSHIP POSITIONING Source: Refinitiv, Morgan Stanley Research

Inst. Owners, % Active 72.2%

HF Sector Long/Short Ratio 2.2x

HF Sector Net Exposure 18.8%

Refinitiv; MSPB Content. Includes certain hedge fund

exposures held with MSPB. Information may be

inconsistent with or may not reflect broader market

trends. Long/Short Ratio = Long Exposure / Short

exposure. Sector % of Total Net Exposure = (For a

particular sector: Long Exposure - Short Exposure) /

(Across all sectors: Long Exposure – Short Exposure).

Morgan Stanley Research 3