Lufax: Trading At 0.1x Tangible Book After China's Consumer Lending Shock

Summary Regulatory tightening and liquidity shocks have driven losses, but Lufax's tangible equity remains nearly 9x the share price, suggesting deep value. LU’s parent, Ping An, provides significant backing, and internal control issues have been addressed, positioning LU for a potential Hong Kong trading resumption. A stop of trading suspension on the Hong Kong stock exchange may be an important catalyst. I expect further near-term losses but see a 3x upside in two years as regulatory and operational risks subside. Mantas Zilicius/iStock via Getty Images Investment Thesis China's microfinance & consumer loan companies are in 2026 in the middle of the storm, which resulted in their stocks changing hands at 10%-20% of tangible book value. However, nuances related to licensing, parent company support, development zones, and the end This article was written by Daring Decisions 27 Followers Follow Hello, I'm qualified specialist in quantitative methods in economy and CFA charter holder. My regular work during more than 20 years is related to financial analysis of the banking activity focused on developing countries. In a free time I find interesting to analyze companies from the market : mainly to read articles, see financials and create own opinion. As I decided to publish articles (very rarely), will be very grateful for your opinion and advice on them!!! Analyst’s Disclosure: I/we have a beneficial long position in the shares of LU either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.