On Friday, ICICI Lombard (ICICIGI:IN) shares obtained a value goal enhance from Jefferies to INR 2,600 from INR 2,180, whereas the agency retained a Purchase ranking on the inventory.
The adjustment displays the insurer’s place as a chief beneficiary of the present uptrend within the motor insurance coverage sector, pushed by strong automobile renewals and a surge in two-wheeler insurance coverage uptake.
The analyst from Jefferies highlighted that ICICI Lombard’s market share and profitability are prone to profit from a lower in aggressive depth. The corporate’s new channel technique, geared toward broadening the funnel for danger choice, can be anticipated to contribute to its development.
Regardless of the potential for an industry-wide enhance in motor claims, ICICI Lombard’s prudent reserving practices are anticipated to take care of a wholesome claims outlook.
In response to the analyst, ICICI Lombard’s mixed ratio, a measure of underwriting profitability, is projected to enhance by roughly 370 foundation factors, reaching round 100% by the fiscal 12 months 2027. The agency’s earnings per share (EPS) estimates have been raised by 6-16% because of these constructive elements.
The analyst additionally famous the potential affect of the transition to Worldwide Monetary Reporting Requirements (IFRS) on ICICI Lombard’s monetary reporting. The change is anticipated to extend reported earnings by 20-25%, which might, in flip, decrease the implied price-to-earnings (P/E) ratio based mostly on September 2026 estimates.
This transition to IFRS accounting requirements is seen as an element that might additional improve the attractiveness of ICICI Lombard’s shares within the eyes of traders.
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