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3 Insurance Company Stocks That You Must Add To Your Portfolio For Solid Returns
Sharekhan has come out with report on the insurance, NBFC and the AMC sector. It has recommended to buy the stocks of three insurance companies ahead of their quarterly numbers for the period ending Dec 31, 2021. Here are the three stocks to buy.
Buy the stocks of ICICI Prudential Life, Max Financial, HDFC Life Insurance
The firm has said from the insurance sector its preferred picks are ICICI Prudential Life Insurance Co, Max Financial Services, HDFC Life Insurance.
"For life insurers, APE growth may witness a mixed trend sequentially with stable VNB margin for our coverage companies. ULIP products may see slower recovery, while annuity products may see robust demand. However, protection demand is expected to remain moderate," the brokerage has said.
According to Sharekhan, new business premium is likely to witness growth aided by annuity growth for HDFC Life. The VNB margin is also to remain stable for the company.
On the other hand for ICICI Prudential Life, the firm expects the VNB margin is likely to witness moderation on q-o-q basis. "Growth for Non Par to remain health and ULIP business is likely to witness recovery," the brokerage has said.
How they foresee earnings for the three insurance companies?
Net profits estimates
| Q3FY22E | Q3FY21 | y-o-y % | y-o-y % | |
|---|---|---|---|---|
| HDFC Life | 301 | 265 | 13.5 | 9.7 |
| ICICI Prudential | 279 | 304 | -8.2 | -37.3 |
| Max Financial | 176 | 252 | -30.2 |
Hard to value insurance players?
The insurance business is hard to value and results can be hard to estimate. That having said, we ourselves are not recommending any stocks at the moment, given that the Sensex has once again crossed the 60,000 points mark. Things looks expensive at the moment and that also holds true for insurance stocks.
The shares of Max Financial was last trading at Rs 1,063 on the NSE, while that of HDFC Life was trading at Rs 658.
Disclaimer
Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, the author, and the brokerage house are not liable for any losses caused as a result of decisions based on the article. The author and his family do not own any of the stocks mentioned above.
