Allianz Malaysia Berhad - Resilient 1Q24

Date: 
2024-05-24
Firm: 
TA
Stock: 
Price Target: 
22.15
Price Call: 
BUY
Last Price: 
22.02
Upside/Downside: 
+0.13 (0.59%)

Review

  • Allianz’s 1QFY24 net profit of RM189.8mn came within expectations, accounting for 24.6% and 25.5% of our and consensus full-year forecasts, respectively. YTD dividend stood at 26.5sen per share (vs. 31.5sen per share in FY23).
  • 1Q24 PBT improved 8.0% to RM251.0mn while revenue grew by 15.1% to RM1.3bn. The commendable performance was driven by higher profit contributions from the life insurance segment. The life insurance business posted a higher PBT of 26.7% YoY to RM122.3mn, boosted by investmentlinked protection business and higher investment income. All key distribution channels grew strongly. Agency ANP increased by 31.2%, Bancassurance surged by 79.5%, and Employee Benefits increased by 9.6%.
  • Meanwhile, the general business PBT declined 5.4% to RM132.3mn due to extraordinarily low claims in 1Q23 and lower fair value gain of investment assets. As a result, the combined ratio increased by 2.8 pts to 87%. Positively, GWP grew 14.0% to RM884.6mn on the back of higher premium stemming from motor business (+20.9% YoY).
  • QoQ, PBT increased 4.9% to RM251.0mn on the back of higher revenue (+2.1%) contribution from both insurance segments due to higher premiums from the motor business and investment-linked protection business portfolio.

Impact

  • No change to our earnings projections pending updates from analyst briefing.

Outlook

  • We remain confident that Allianz will continue outperforming the industry growth in 2024, driven by the expansion of distribution channels and market segments.

Valuation

  • We place our target price (RM22.15) and Buy recommendation under review pending management guidance at today’s analyst briefing.

Source: TA Research - 24 May 2024

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