ICICI Lombard General Insurance Company (ICICIGI) Q4 17/18 earnings summary

Executive summary

• FY2018 GDPI reached ₹123.57bn, up 15.2% YoY; ranked 4th overall and remained India’s largest private-sector non-life insurer, with 8.2% industry and 16.8% private-sector market share.

• Profit after tax rose 22.8% to ₹8.62bn; combined ratio improved to 100.2% from 103.9%, while ROAE was 20.8%.

• FY2018 included the first listing of a non-life insurer on Indian stock exchanges; the IPO was an offer for sale, so no proceeds went to the business.

Financial highlights

• GWP was ₹126.00bn vs ₹109.60bn; net earned premium rose to ₹69.12bn from ₹61.64bn, and investment income in the P&L account increased to ₹4.06bn from ₹3.09bn.

• Operating profit rose 30.6% to ₹9.24bn; PBT increased 31.4% to ₹11.96bn and PAT rose 22.8% to ₹8.62bn. Basic/diluted EPS was ₹19.01/₹18.99 vs ₹15.66/₹15.58.

• Net claims incurred increased 7.3% to ₹53.15bn, below net earned premium growth of 12.1%; overall loss ratio improved to 76.9% from 80.4%.

• Total assets rose 27.4% to ₹297.50bn; investment assets increased to ₹181.93bn from ₹149.50bn, and net worth rose to ₹45.41bn from ₹37.25bn.

Outlook and guidance

• Indian general insurance GDPI grew 17.5% in FY2018 to ₹1,507.05bn; low non-life penetration of ~0.8% of GDP and government support for insurance were cited as growth drivers.

• Domestic travel was identified as an area of focus for profitable growth; SME penetration, digital distribution, rural channels and tailored solutions were also strategic priorities.

• Crop/weather underwriting remained cautious following adverse Kharif loss experience; FY2018 crop/weather GDPI grew 10.2%, below industry growth of 18.9%.