Motilal Oswal Bullish On 2 Large Cap Insurance Stocks, Shares Set To Rally, Buy For Robust Returns

Motilal Oswal initiates "buy" on two leading large-cap Insurance sector stocks which include ICICI Prudential Life Insurance Company Limited and SBI Life Insurance Company Limited. The brokerage has assigned an attractive valuation to the stocks and claims gains of up to 25% if purchased at the current market price today. Here are the key highlights of the stock:

ICICI Prudential Life Insurance Company Limited

Motilal Oswal rated a "buy" with a target price of Rs. 725 apiece on the stock of ICICI Prudential Life. With the given target price, the brokerage sees a 20% potential jump in share price. On the NSE, the stock is currently trading at Rs 475.65 apiece. Its 52-week high is Rs. 648.85 apiece, and its 52-week low is Rs. 430 apiece, respectively.

 
The stock surged 4.89% in the past 1 week, and 1.14% in the past 1 month, respectively. It has fallen 9.26% in the past 3 months, 17.69% in the past 1 year and 0.45% in the past 3 years, respectively. However, the stock jumped 20.09% in 5 years, giving a positive return to shareholders. 

According to the brokerage, New business premium growth to remain modest; Trends in Banca channel to be closely monitored. Expect the expense ratio to move in line with a pick-up in business growth. Expect VNB growth to remain muted and margins to remain stable. Expect growth in the Non-Linked Savings business to remain healthy and a recovery in the Protection business.

SBI Life Insurance Company Limited

With a target price of Rs 1,600 apiece has assigned a "Buy" on the stock of SBI Life. It claims a 25% potential upside in the share price from its current level. The stock is currently trading at Rs 1,285.50 apiece on NSE, 1.41% up from its previous close. Its 52-week low at Rs 1,003.50 apiece and 52-week high at Rs 1,340.35 apiece, respectively.

The stock surged 4.29% in the past 1 week, and 3.13% in 3 months, respectively. It moved up 6.52% in the past 1 year, 30.62% in the past 3 years, and 82.94% in the past 5 years, respectively.
According to the brokerage, New business premiums to remain muted. Cost leadership to continue. Expect margin to remain healthy at ~31%, though likely to moderate sequentially; VNB growth to remain healthy. Expect protection mix to improve and Non-PAR to remain healthy; ULIP to see an uptick.

Disclaimer

The stocks have been picked from the brokerage report of Motilal Oswal. Greynium Information Technologies, the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to consult with certified experts before making any investment decision.