ICICI Lombard Q4FY25 earnings preview: ICICI Lombard in Tuesday’s trade is in focus ahead of its fourth-quarter earnings later today post-market hours. Ahead of its financial results, the insurer major traded with gains over 3 per cent or Rs 52 at Rs 1,770.7 per share on the BSE.
ICICI Lombard Q4FY25 preview
Zee Business research estimates the private general insurer major to report a mixed set of March quarter earnings for the just concluded fiscal year 2024-25. As per the research team during FY25, the premium collection for non-life insurers showed slow growth at just 6 per cent and this is likely to impact the company’s earnings.
Also, the company’s auto insurance business is seen to take a hit and consecutively impact the company’s overall premium collection during the review quarter. Nonetheless, the market share will continue to improve in the segment.
Net Premium during the reporting quarter is expected to rise 15 per cent year-on-year to Rs 5,050 crore from Rs 4,368 crore reported in the year-ago period.
Bottomline at ICICI Lombard to grow in double digits in March quarter
Furthermore, cost containment at the operational level is expected to impact the company’s profitability which is seen to grow 12 per cent on-year to Rs 580 crore as against Rs 519 crore in the same period of the previous year.
In insurance, the combined ratio is a key profitability metric that measures the percentage of earned premium spent on claims (loss ratio) and operational expenses (expense ratio). A combined ratio below 100% indicates an underwriting profit, while a ratio above 100% suggests underwriting losses.
Annualised Premium Equivalent or APE at the firm is also seen rising 39 per cent on-year to Rs 6,069 crore in the review period as against Rs 4,368 crore in the March quarter of the previous year.
The metric APE helps to compute the amount of new business earned over a period, when sales encompass both single as well as regular premiums.
The combined ratio at the insurer is seen rising to 103.4 as against 102.2 in the same quarter last year amid rising claims and other costs. In insurance, the combined ratio is a profitability metric that measures the percentage of earned premium spent on claims as well as other operational expenses (expense ratio). A combined ratio below 100 per cent suggests an underwriting profit, while a ratio above 100 per cent means underwriting losses.
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