Canara HSBC Life shares hit fresh 52-week high as Investec initiates coverage with 'Buy', sees up to 69% upside

Canara HSBC shares rise amid strong buying. 

Canara HSBC Life Insurance Company shares advanced to a fresh 52-week high on Tuesday following strong buying interest after brokerage Investec initiated coverage on the insurer with a ‘Buy’ rating.

The stock hit a 52-week high of Rs 157.11 on the National Stock Exchange, marking a jump of about 18 percent. It opened the session with a sharp gain of 17.92 percent and extended its rally for the second consecutive day.

However, the stock pared most of its early gains during the session. At around 2 pm, shares of Canara HSBC Life were trading at Rs 137.51 apiece, up 3.21 percent.

Investec has initiated coverage on the insurer, a joint venture between Canara Bank and HSBC Insurance, with a ‘Buy’ call and a target price of Rs 225. The brokerage sees an upside potential of about 69 percent from Monday’s closing price of Rs 133.23.

In its note, Investec said Canara HSBC Life is a professionally run insurer that has delivered a 21 percent compound annual growth rate in annualised premium equivalent over the past decade, a key metric for the insurance sector.

The brokerage added that HSBC’s plans to double its branch network over the next two to three years, along with the insurer’s efforts to scale up its distribution channels, could help the company grow faster than the industry over the next three years, reported Informist.

Shares of Canara HSBC Life Insurance Company have risen about 25.4 percent since their listing in October.