We have a buy rating on ICICI Lombard General Insurance Company with a target price of Rs 1,450 per share.
ICICI Lombard General Insurance Company is fourth largest non-life insurance company and the largest private player in the industry. Including motor, travel, health, fire, property & casualty, marine, engineering, aviation and liability through extensive distribution network of 265 branches and 910 virtual offices.
During FY19, ICICI General Insurance issued 26.5 million policies, up 12.8 percent from FY18. Gross direct premium income (GDPI) increased 17.2 percent YoY to Rs 144.88 billion while profit after tax grew 21.8 percent YoY to Rs 10.49 billion.
Its improved risk selection, conservative reserving and disciplined underwriting practice has helped in prudent management of combined ratio.
With focus on SME insurance market and cross selling opportunities.
In terms of GDPI growth, management expects that the industry and the company to grow in the range of 15-20 percent in preferred segments on a medium to long term horizon.
In terms of macro scenario, the domestic non-life industry has plenty upside. Current low penetration levels (0.93 percent as against global average of 2.8 percent, low density (premium per person of USD 18 compared to world average of USD 297), rapid urbanization, young Indian population, increasing disposable income and rising awareness of risk protection will continue to be the demand drivers in the sector.
We have a buy rating on ICICI Lombard General Insurance Company with a target price of Rs 1,450 per share.Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.Get access to India's fastest growing financial subscriptions service Moneycontrol Pro for as little as Rs 599 for first year. Use the code "GETPRO". Moneycontrol Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the Moneycontrol website or mobile app.