Prudential Shares Slip Despite Double-Digit Profit Growth as Investors Weigh China Risks

Shares in Prudential plc (LON: PRU) fell on Thursday even as the Asia-focused insurer reported a strong set of half-year results, with new business profit, capital generation and earnings all rising by double digits.

The stock was down around 1% in London trading, changing hands near 1,029p, having opened lower after the results were released before markets in Hong Kong opened.

For the six months to 30 June 2026, Prudential posted an 8% rise in new business profit to $1,384 million, with margins expanding two percentage points to 40%. Adjusted operating profit climbed 9% to $1,812 million, while adjusted earnings per share rose 17% to 58.4 cents. Group embedded value reached $39.1 billion, up from $37.8 billion at the end of 2025.

The insurer sweetened shareholder returns, lifting its interim dividend 15% to 8.88 cents per share and adding a further $0.3 billion to its 2026 share buyback programme, subject to proceeds from a partial sale of its ICICI Prudential Asset Management stake.

Despite the upbeat headline numbers, investors appear focused on softer underlying dynamics in Prudential’s core Chinese Mainland business, where new business profit was hit by tighter bancassurance expense regulations, with management guiding to flat full-year profit growth there versus 2025. IFRS profit after tax also fell 27% to $995 million, reflecting economic and accounting volatility rather than underlying trading.

CEO Anil Wadhwani struck a confident tone, reiterating guidance for double-digit growth in new business profit, operating free surplus, adjusted EPS and dividends per share for the full year, while flagging strategic moves in Malaysia, India and Hong Kong as evidence of long-term growth investment.

Nonetheless, near-term concerns over Chinese regulatory pressure and tougher prior-year comparatives appear to be weighing on sentiment despite the otherwise robust results.