Buy GIC, target price Rs 165: HDFC Securities

Promoters held 85.8 per cent stake in the company as of June 30, 2020, while FIIs held 0.3 per cent, DIIs 11.9 per cent and public and others 2.1 per cent.

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The brokerage expects the company’s underwriting profitability to improve in 2Q/3QFY21 as the impact of lower loss ratios for 1QFY21 come in with a lag.
HDFC Securities has given a buy rating to GIC Reinsurance with a target price of Rs 165. The share price moved up by 1.87 per cent from its previous close of Rs 133.85. The stock’s last traded price is Rs 136.15.

Investment Rationale
The brokerage expects the company’s underwriting profitability to improve in 2Q/3QFY21 as the impact of lower loss ratios for 1QFY21 come in with a lag. It has tweaked the estimates to build in lower premium growth, higher CORs, and lower investment yields.

Promoter/FII Holdings
Promoters held 85.8 per cent stake in the company as of June 30, 2020, while FIIs held 0.3 per cent, DIIs 11.9 per cent and public and others 2.1 per cent.


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