ICICI Lombard Declares Dividend, PAT Dips To Rs 577 Cr In Q2; Buy?

ICICI Lombard General Insurance Company today released for the quarter and half-year ended September 30, 2023. The company's net profit fell 2.2% YoY, from Rs 590.5 crore in Q2FY23 to Rs 577.3 crore in the quarter under review. Gross Direct Premium Income (GDPI), which jumped by 17.4% YoY to Rs 6,086 crore in Q2FY24 from Rs 5,185 crore in the same quarter a year prior, indicates that ICICI Lombard had a strong quarter.

PBT jumped by 25.3% to Rs 764 crore in Q2 of FY24 compared to Rs 610 crore in Q2 of FY23, while PBT increased by 19.4% to Rs 1,284 crore in the first half of FY24 from Rs 1,075 crore in the first half of FY23.

The company's combined ratio stood at 103.9% in Q2FY2024 as against 105.1% in Q2FY2023. The total ratio was 102.8% and 104.3%, respectively, when CAT losses of Rs 0.48 billion in Q2 FY2024 and Rs 0.28 billion in Q2 FY2023, were excluded. In Q2 FY2024, the company's Return on Average Equity (ROAE) was 21.1%, down from Q2 FY2023, when it was 24.5%. In contrast to June 30, 2023, when it was 2.53x, the solvency ratio at September 30, 2023 was 2.59x, above the regulation minimum of 1.50x.The solvency ratio as of March 31, 2023, was 2.51x.

The company's Board of Directors declared and paid an interim dividend of Rs. 5 per equity share, or 50.0% of the share's face value of Rs. 10, for the fiscal year that ended on March 31, 2024. The interim dividend will be paid to the equity shareholders of the company whose names are listed as beneficial owners of the shares as of the record date, which is Friday, October 27, 2023, in the company's register of members or in the records of depositories. On or before Friday, November 10, 2023, the interim dividend will be paid to the equity shareholders of the company.

ICICI Lombard General Insurance Company Share Price Target

Ameya Ranadive CMT CFTe Equity Research Analyst, Choice Broking said, "ICICIGI is currently trading at Rs 1370. On the daily chart, the price is trading within a range of Rs 1414 to Rs 1287, indicating a period of sideways price action. The overall trend is still bullish. If the price manages to sustain itself above the Rs 1414 level, it has the potential to target levels of Rs 1545 and Rs 1600. Conversely, Rs 1287 and Rs 1266 serve as crucial support levels."
"Furthermore, ICICIGI is currently trading above critical Exponential Moving Averages (EMAs), including the 20-day, 50-day, 100-day, and 200-day EMAs. This positioning reinforces its bullish momentum and suggests the possibility of further upward price movement," said Ameya Ranadive.

"The Relative Strength Index (RSI) is currently at 61.48 and trending upwards, signifying increasing buying momentum. Additionally, the Stochastic Relative Strength Index (Stoch RSI) has recently shown a positive crossover from the oversold region. This combination of technical indicators suggests that ICICIGI may have the potential to reach a target price of Rs 1600 in the near term," said Ameya Ranadive.

"To effectively manage risk, it is advisable to implement a stop-loss (SL) at Rs 1266 to safeguard your investment in case of an unexpected market reversal. In summary, considering the technical analysis and current market conditions, ICICIGI appears to offer an appealing buying opportunity for those targeting a Rs 1600 price objective, provided that prudent risk management measures are in place," added Ameya Ranadive.

Disclaimer

The recommendations made above are by market analysts and are not advised by either the author, nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.