Prudential anticipates double digit growth from new business in 2025

Prudential, the Asia-focused insurer, has reported a robust 2024 performance and projected more than 10% growth across key metrics for 2025. This forecast comes amidst increasing demand for long-term savings, protection products, and wealth management services in its key markets. The company highlighted significant opportunities arising from its core presence in Asia and Africa, where insurance penetration remains low.

The group’s adjusted operating profit saw an 8% rise year-on-year to $3.13 billion, while total new business profit increased by 11% to $3.08 billion. Anil Wadhwani, Chief Executive of Prudential, emphasised that structural growth trends across Asia and Africa are driving strong results. He stated, “Insurance penetration rates in Asia are low, alongside growing demand for retirement planning and wealth management, particularly in higher-income markets.”

Regional performance varied, with Hong Kong delivering a 6% rise in profits to $1.07 billion, Indonesia recording a 21% jump to $268 million, and Singapore seeing a 19% increase to $693 million. However, profits in mainland China dipped slightly by 1% to $363 million, reflecting economic challenges and declining government bond yields in the region.

Analysts have expressed optimism about Prudential’s growth trajectory. Jefferies analysts noted: “The most significant takeaway is Prudential’s guidance towards double-digit growth across all main metrics in 2025.” To support shareholder value, Prudential has also accelerated its $2 billion share buyback programme, now set to be completed by the end of 2025, earlier than its original mid-2026 target. Shares rose by 3% to 796¾p following the announcement.

Prudential further announced a second interim cash dividend of 16.29 cents per share for 2024, taking its total dividend payout for the year to 23.13 cents. This reflects the insurer’s intention to increase dividends by at least 10% in 2025, a move welcomed by investors.

Separately, the company unveiled a new 70/30 joint venture with Indian tech group HCL to establish a healthcare insurance business in India. Wadhwani described India’s growing economy, burgeoning population, and expanding middle class as key drivers of opportunity in the health, protection, and retirement sectors.

Founded in 1848, Prudential remains a FTSE 100 heavyweight with a £21 billion market capitalisation. However, its operational centre is now firmly rooted in Asia. The company severed many of its UK ties following the demerger of its M&G life business in 2019 and the spin-off of its US operations in 2021.