Sell New India Assurance; target of Rs 100: HDFC Securities

HDFC Securities' research report on New India Assurance

NIACL is India’s largest insurer but continues to make high underwriting losses. We note that the company’s competitive positioning is weakening and remain concerned about its ability to write profitable business. We estimate an FY22E adj. ROE of just 5.9% and can, at best, assign a valuation of just 0.7x FY22E ABV (less 10% discount for an additional 10.4% supply).

Outlook

We rate NIACL a SELL with a target price of Rs 100.