More Stories

Informist, Monday, Oct. 14, 2024

By Richard Fargose

MUMBAI – ICICI Lombard General Insurance Co. Ltd.'s net profit for Jul-Sept is expected to rise a little over 19% on year to INR 6.87 billion on strong growth in premium income in the motor and health segments, according to the average of the estimates of four brokerage firms. Sequentially, the net profit is seen rising 18.4%.

The estimates for net profit range from INR 6.40 billion to INR 7.10 billion. The net premium income, according to the average of estimates of four brokerages, is expected to rise 15% on year and almost 10% sequentially to INR 49.52 billion. The company is scheduled to announce its September earnings on Friday.

Despite lower industry growth, ICICI Lombard General Insurance has increased its market share in the motor insurance segment by 122 basis points to 11% so far in the current financial and in the health segment by 70 bps to 7.1%, Nuvama Wealth Management said.

"For general insurers, especially ICICIGI (ICICI Lombard General Insurance), premium growth is likely to be healthy, led by market share gains," broking firm Sharekhan said in its pre-earnings report. 

Analysts are divided over the insurer's combined ratio, which measures the money flowing out of an insurance company in the form of dividends, expenses, and losses. A ratio below 100% indicates that a company is making an underwriting profit, while a ratio above 100% means it is paying out more money in claims than it is receiving from premiums.

Some analysts expect operational efficiency to drive improvements in operating expenditure and combined ratio. But, others see natural catastrophe claims to impact the profitability ratio. Emkay Global Financial Services sees the company reporting 71% claims ratio in Jul-Sept, 30 bps higher than a year ago. In Apr-Jun, the company's combined ratio was 102.3% compared to 103.8% a year ago.

"We expect CORs (combined ratio) to remain high due to CAT (catastrophe) losses (cyclone Remal and Asna) and increased losses in the health segment due to seasonal factors," said Nuvama Wealth Management.

Nuvama Wealth Management expects ICICI Lombard General Insurance's strong investment income to drive profit after tax higher by 20.8% on year. In Apr-Jun, the company's net income from investments had increased over 31% on year to 8.45 bln rupees.

On Monday, shares of ICICI Lombard General Insurance ended 1.1% higher at INR 2,089.35 on the National Stock Exchange.

Following are the Jul-Sept earnings estimates for ICICI Lombard General Insurance based on estimates compiled by Informist from four brokerage houses:

End

Edited by Ashish Shirke

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

Informist Media Tel +91 (22) 6985-4000  

Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2024. All rights reserved.