China's Lufax drops on sinking profits, J.P.Morgan downgrade

Lufax Holding

25/11/2022 14:09

** Shares of Shanghai-based financial services firm Lufax
Holding Ltd  LU.N  drop 14.2% to $1.50 premarket
    ** Company reports 67% fall in Q3 profit, as its core
customer base of small businesses feels the pinch of persistent
inflation and a deteriorating economy
    ** J.P.Morgan says LU's profit is much worse than
traditional banks, which had over 8% profit growth on average in
Q3; brokerage cuts rating on stock to "underweight" from
"overweight"
    ** Outlook for LU, which positions itself as a fintech
lender, "remains grim" for 2023 due to downward pressure on loan
growth, commission rate and asset quality - brokerage
    ** JPM cuts PT on stock to $1.60 from $6.40; Citigroup also
cuts PT to $3.52 from $6.06
    ** 10 of 19 brokerages rate the stock "buy" or higher, 7
"hold" and 2 "sell"; median PT $2.95 - Refinitiv
    ** Lufax, a unit of China's biggest insurer, Ping An
Insurance Group Co of China Ltd  601318.SS , has been seeking a
listing in Hong Kong
    ** As of Wednesday's close, Lufax shares down 69% so far
this year
 (Reporting by Uday Sampath in Bengaluru)
 ((UdaySampath.Kumar@thomsonreuters.com; Twitter: https://twitter.com/sampath_uday))