Shuli Ren is a Bloomberg Gadfly columnist covering Asian markets. She previously wrote on markets for Barron's, following a career as an investment banker, and is a CFA charterholder.

Think of AIA Group Ltd. as a growth stock, not a dividend play.

The insurer's shares fell as much as 2.2 percent in Hong Kong despite a handy earnings beat, because investors wanted more. AIA raised its dividend by 17 percent to 25.62 Hong Kong cents, well below the 39 percent top-line growth. Meanwhile, AIA is sitting on an almost $11 billion surplus and currently trades at a 1.5 percent yield.

We should focus instead on the resilience of the AIA brand, because even China's Great Money Wall can't stop it. The value of new business in Hong Kong soared 54 percent to $828 million even after China late last year banned mainland visitors from using UnionPay credit cards to buy insurance policies in the territory. Around half of AIA's Hong Kong business came from such visitors, according to former CEO Mark Tucker, who handed over to Ng Keng Hooi in June.

Meanwhile, AIA's agency business model is paying off in China: Its mainland revenue jumped 65 percent from a year ago to $434 million.  

Anyway, this is not the time for AIA to be handing out extra cash, because it has a new problem: It's too vested in China.

The mainland now brings in more money than AIA's Southeast Asia businesses combined, while its Hong Kong operation -- including that huge chunk from China -- constitutes 45 percent of the revenue pie. 

Vested in China
AIA's mainland China business is now bigger than Asean
Source: Bloomberg

So AIA must keep some powder dry to diversify geographically. Vietnam and India, for example, whose revenue numbers AIA doesn't break out, have been growing rapidly in recent years.

Indeed, Vietnam could be AIA's next big market. The nation had more than $2 trillion insured assets in 2016, a 31 percent jump from the year before, according to Morgan Stanley. AIA said the value of new business in Vietnam grew more than 12-fold since the Hong Kong IPO in 2010.

The Next Big Market?
Vietnam's insurance market expanded 31 percent last year
Source: Morgan Stanley

Even that market share in Hong Kong and China needs defending. What's Tucker's strategy at HSBC Holdings Plc, where he is now chairman? Will he replicate his success at AIA and push HSBC deeper into insurance? With a profit margin of 54 percent, AIA's business is almost too good not to contest.

Forget fretting about the dividend. Investors should be assessing AIA's growth prospects instead.

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

To contact the author of this story:
Shuli Ren in Hong Kong at

To contact the editor responsible for this story:
Paul Sillitoe at