Buy ICICI Lombard; target of Rs 2300: Motilal Oswal

BUY

Motilal Oswal's research report on ICICI Lombard

ICICI Lombard’s (ICICIGI) gross written premium rose 2% YoY in 2QFY26 to INR70.6b (in line), impacted by the 1/n regulation. NEP grew 12% YoY to INR56.5b (16% beat). For 1HFY26, NEP grew 13% YoY to INR108b. The claims ratio stood at 72.1% (vs our est. of 74%) vs. 71.4% in 2QFY25. Commission ratio increased to 19.1% (our est. 17.5%) vs. 17.5% in 2QFY25, and opex ratio came in at 14% (our est. 14.5%) vs. 15.6% in 2QFY25. Combined ratio was at 105.1% in Q2FY26 vs 104.5% in 2QFY25. Excluding the impact of CAT losses of INR0.7b in 2QFY26 and INR0.9b in 2QFY25, the combined ratio stood at 103.8% and 102.6%, respectively.

Outlook

We have raised the EPS estimates by only 1%/2%/3% for FY26/FY27/FY28 due to a higher combined ratio in the motor segment. Reiterate BUY with a TP of INR2,300 (based on 30x Sep’27E EPS).

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