First Read: Prudential "Investor feedback on Pru's underperformance" (Buy) Ahmed

Research evidence excerpt

First Read: Prudential "Investor feedback on Pru's underperformance" (Buy) Ahmed

Global Research

4 June 2026ab

First Read

EquitiesPrudential

Investor feedback on Pru's underperformance United Kingdom

Insurance, Life

12-month rating Buy

Headline: Investor feedback on Pru's underperformance

12m price target 1,470p

China issued Decree 837 on Monday giving more clarity around the overseas

investments by investors within China (see our First Read here). Investors see Pru's Price (03 Jun 2026) 1,055p

underperformance linked to this decree and a crackdown in China on illegal cross border

activities (see here) . We summarise our key debates/potential risks for Pru below. RIC: PRU.L BBG: PRU LN

Trading data and key metrics

UBS Summary: 52-wk range 1,220p-868

Market cap. £26.9b/US$36.1b

Decree 837 follows fines for brokers Futu, Tiger and Long Bridge on 22 May (see Shares o/s 2,548m (ORD)

here) for offering domestic Chinese investors access to overseas trading. Free float 100%

Currently, there are four mechanisms for this, including: 1) Stock connect, 2) Wealth Avg. daily volume ('000) 7,642

connect, 3) QDII and 4) MRF. Avg. daily value (m) £83.5

Common s/h equity (12/26E) US$21.3b

However, a fifth mechanism also exists whereby insurance products that are P/BV (12/26E) 1.6x

underwritten and bought in HK (see clarification in 2004 by the Chinese regulator) by

EPS (UBS, diluted) (USD)

Mainland Chinese Visitors is allowed. These products are under the 2004 regulation

UBS Cons.

allowed with further controls. In 2016, by the HK Insurance Authority further increased

12/26E 1.21 1.19

disclosure requirements for HK insurers selling policies to MCVs (see here). We note

12/27E 1.80 1.43

these policies are mainly sold to customers with HK bank accounts (i.e. funds 12/28E 1.56 1.60