ICICI Lombard Q4 Results Review: Beat On Combined Ratio; PAT Miss Due To Investment Income — Motilal Oswal

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Motilal Oswal Report

The general insurance industry’s growth rate in FY25 remained slow, due to: weak infrastructure investments, slow credit growth, regulatory impact, and weak trends in motor sales growth.

However, ICICI Lombard General Insurance Co. Ltd. continues to focus on profitable growth across segments, with motor expected to grow in double digits driven by targeted efforts in older vehicles and commercial vehicles, along with improved portfolio segmentation. The Health segment’s momentum remains strong, particularly in retail, where the company has gained market share and is targeting double-digit growth— supported by new customer acquisition and inflation-linked pricing.

Commercial lines saw a weak FY25 due to soft fire pricing and sluggish capex, but early signs of recovery are visible in April fire renewals, setting the stage for a rebound.

Overall, we expect a growth recovery in FY26 and stable improvement in profitability, with combined ratio improving to 101.5% by FY27. PAT is likely to grow ~14%/16% in FY26 and FY27. We have broadly retained our FY26/FY27 earnings estimates as higher net earning premium estimates are offset by lower investment income. Reiterate Buy with a target price of Rs 2,200 (based on 33 times Mar’27E EPS).

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