KUALA LUMPUR: CIMB Equities Research said Allianz Malaysia offers the only exposure to a well-managed Malaysian composite insurer that is controlled by an established international insurance group.
It said on Thursday, April 14 its key attractions are (1) its well-managed general insurance business with above-industry underwriting margin, and (2) the expected exponential expansion of life insurance contributions.
CIMB Research said Allianz was also set to ride on the upward adjustment of motor tariffs starting next year.
'Assuming a 40-50% discount to the P/E implied in our target price for AIA, we arrive at a target P/E range of 8-9.6 times, which implies a value of RM8.20-9.80 for Allianz or upside of 64-97%.
'Despite its strong fundamentals and bright outlook, the stock is trading at only 6x P/E and 1.2x P/BV. Its only drawback is its low liquidity due to lack of newsflow and coverage by analysts,' it said.
It said on Thursday, April 14 its key attractions are (1) its well-managed general insurance business with above-industry underwriting margin, and (2) the expected exponential expansion of life insurance contributions.
CIMB Research said Allianz was also set to ride on the upward adjustment of motor tariffs starting next year.
'Assuming a 40-50% discount to the P/E implied in our target price for AIA, we arrive at a target P/E range of 8-9.6 times, which implies a value of RM8.20-9.80 for Allianz or upside of 64-97%.
'Despite its strong fundamentals and bright outlook, the stock is trading at only 6x P/E and 1.2x P/BV. Its only drawback is its low liquidity due to lack of newsflow and coverage by analysts,' it said.
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