HDFC Securities: New India Assurance - High Claims Ratio Dents Profits
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HDFC Securities Report
Despite being India’s largest insurer, New India Assurance (NIACL) 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 6.5% and can at best assign a valuation of just 0.7x Sep-22E ABV (less 10% discount for an additional 10.4% supply).
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