Investment Memo: ICICIGI

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Our Rating: HOLD

Mehabe score: 4
G Factor: 4
Piotski Score: 7
The stock has a rating HOLD. The mehabe team score is reflective of its fundamental and technical merits. A rating above 8 is considered good buy. The stock has a G-Factor of 4 and Piotski score of 7.

Description

ICICI Lombard General Insurance Co. Ltd is one of the leading and established private sector general insurance companies in India. It offers a well-diversified range of products and risk management solutions through multiple distribution channels.[1]
Site: ICICIGI
Main Symbol: ICICIGI

Price Chart

Technical Analysis

• Stock trades at 1401.0, above its 50dma 1323.22. It also trades above its 200dma 1394.15. The stock remains bullish on techicals
• The 52 week high is at 1675.00 and the 52week low is at 1192.00

Price Chart

P/E Chart

Sales and Margin

Strengths

– is almost debt free.
– is expected to give good quarter
– has been maintaining a healthy dividend payout of 22.97%

Weakness

– Stock is trading at 9.25 times its book value
-Earnings include an other income of Rs.809.93 Cr.
-Promoter holding has decreased over last 3 years: -7.83%

Competition

– The industry trades at a mean P/E of 62.4x. HDFC Life Insur. trades at the industry’s max P/E of 103.22x. ICICIGI trades at a P/E of 54.1x
– Industry’s mean G-Factor is 2.9 while the mean Piotski score is 7.0. ICICIGI has a G-Factor of 4 and Piotski scoreof 7.
– Average 1 month return for industry is 6.3%. The max 1- month return was given by ICICI Lombard: a return of 12.04 %

Quarterly Results

• Sales for period ended Mar 2022 is Rs 4020.0 cr compared to Rs 3163.0 cr for period ended Mar 2021, a rise of 27.1% .

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• Company reported negative operating profit of Rs -371.0 cr for period ended Mar 2022. For same period last year, operating profit was -15.0.
• The EPS for quarter ended Mar 2022 is Rs 6.37 compared to Rs 6.47 for previous quarter ended Dec 2021 and Rs 7.6 for Mar 2021.

Profit & Loss Statement

Profit&Loss Comments

• Company reported sales of Rs 16026.0 cr for period ended Mar 2022 vis-vis sales of Rs 12666.0 cr for the period ended Mar 2021, a healthy growth of 21.0%. The 3 year sales cagr stood at 12.8%.
• Operating margins shrank to 5.0% for period ended Mar 2022 vis-vis 16.0% for period ended Mar 2021, contraction of 1100.0 bps.
• Net Profit reported at Rs 1271.0 cr for period ended Mar 2022 vis-vis sales of Rs 1473.0 cr for the period ended Mar 2021, falling 15.9%.
• Company recorded a Net Profit CAGR of 6.6% over the last 3 years

Balance Sheet Statement

Cash Flow Statement

Cash Flow comments

Sales Growth

Profit Growth Statement

Profit Growth Statement

Stock Price CAGR

Return of Equity

General Comments

– The stock has given a return of 0% on a 1 Year basis vis-vis a return of 10% over the last 3 Years.
– The compounded sales growth on a TTM bassis is 27% vis-vis a compounded sales growth of 13% over the last 3 Years.
– The compounded profit growth on a TTM basis is -14% vis-vis a compounded profit growth of 7% over the last 3 Years.

Ratios

Shareholding Pattern

– FII shareholding has remained largely constant. The Mar 2022 fii holding stood at 26.88% vis-vis 28.12% for Dec 2021
– Public shareholding has remained largely constant. The Mar 2022 public holding stood at 11.34% vis-vis 10.36% for Dec 2021

Conclusion

– is almost debt free.
– is expected to give good quarter
– has been maintaining a healthy dividend payout of 22.97% – Stock is trading at 9.25 times its book value
-Earnings include an other income of Rs.809.93 Cr.
-Promoter holding has decreased over last 3 years: -7.83%

• The business fundamentals of the stock remain stable. Stronger near term results will build interest in the stock. We suggest to wait for a upturn in business performance.
• Technically, the stock remains above its 50 DMA 1323.22 and is trading at 1401.0, thus bullish price action wise.
• Thus, overall we retain a HOLD on the stock.

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