Lufax downgraded to Equal Weight from Overweight at Morgan Stanley

Morgan Stanley analyst Richard Xu downgraded Lufax (LU) to Equal Weight from Overweight with a price target of $1.52, down from $7, citing its worse than expected credit quality deterioration in Q3. This will lead to greater uncertainty on its loan volume, its CGI rate from Ping An P&C, and ultimately its net take rate, Xu tells investors. He expects weak credit demand and credit risk to persist in 2023 given the macro environment and believe 360 DigiTech (QFIN) and Bairong are better positioned to weather the storm than Lufax, Xu added.