“Buy ICICI Lombard General Insurance with target Rs 1,210: Anand Rathi”

In the retail health insurance segment, the company sees significant opportunity in Tier II and Tier III cities as the loss ratio in these cities has been substantially lower than the rest of the portfolio.

ICICI Lombard General Insurance Company is 4th largest non-life insurance company and the largest private player in the industry.

The company, which has substantially leveraged on its strong brand, offers a wide range of insurance solution including motor, travel, health, fire, crop/weather, property & casualty, marine, engineering, aviation and liability through extensive distribution network.

ICICIGI issued 23.5 million policies in FY18 and its gross direct premium income (GDPI) increased 15.2% year over year(y/y) to Rs 123.57 billion.

 GDPI increased 16.7% y/y, outpacing the industry growth rate of 13.1%. Focusing on retail health, ICICIGI grew its retail indemnity new business by more than 50% during 9M2019.

With focus on SME insurance market and cross selling opportunities, ICICIGI looks to drive growth on the back of several initiatives – expanding distribution network, enhancing product offering and bolstering technology to improve overall operational efficiency and customer service.

In the retail health insurance segment, the company sees significant opportunity in Tier II and Tier III cities as the loss ratio in these cities has been substantially lower than the rest of the portfolio.

Given ICICIGI’s impressive underwriting performance, diversified product mix and favourable macro traits, we believe the company is well positioned for long term growth and initiate our coverage on ICICI Lombard General Insurance Company Ltd. with a buy rating and a target price of Rs 1,210 per share.

Source: Money Control

Date: 20th May, 2019

Warm Regards,

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s