CapitalVia Global
ICICI Lombard (BUY)
Target: ₹1,590
CMP: ₹1,480.65
ICICI Lombard General Insurance Company Limited (ICICIGI) is one of the leading private sector non-life insurers in India. The company offers a comprehensive and well-diversified range of products, including motor, health, crop, fire, personal accident, marine, engineering and liability insurance, through multiple distribution channels like individual agents, corporate agents – banks, other corporate agents, brokers, MISPs, digital and direct sales.
The company commenced operations in 2002 after obtaining regulatory approval from IRDAI.
For YTD FY21, ICICI Lombard reported a 3.85 per cent y-o-y increase in premiums to ₹11,951.35 crore. At ₹313.53 crore in December 2020, quarterly net profit rose 6.6 per cent from ₹294.11 crore in December 2019. In December 2020, EBITDA stood at ₹418.23 crore, up 7.26 per cent from ₹389.92 crore in December 2019.
The ROE of ICICI Lombard General Insurance corresponds very favourably to the average of 14 per cent in the market. This possibly laid the foundation for the modest 19 per cent net income growth of ICICI Lombard General Insurance seen over the last five years.
Considering the strong performance of the company we recommend going long on ICICI General Insurance with a target price of ₹1,590.
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