Reported EPS for 2010-Rs.6.45.
Sri Lanka is still at the infancy when it comes to insurance and has a huge potential in both life and general insurance. With the strong backing of HNB bank HASU could become a definite winner in the sector. I have analysed the earnings of the company below.
Price Earnings (P/E) on reported EPS-12Industry analysis (forward PE)
Ceylinco Insurance -50
We can see that HASU is clearly undervalued and has a potential price of 100-140.
Yes lion HASU and JINS are most undervalued in this sector. JINS is stagnant in the range of Rs.15-18... HASU will be on upward track..
AMANA TAKAFUL PLC 75.6
JANASHAKTHI INSURANCE COMPANY PLC 9.0
UNION ASSURANCE PLC 33.0
CEYLINCO INSURANCE PLC 36.7
HNB ASSURANCE PLC 13..
As you expect it would hit in the range of 120-140...
See the article for HASU http://srilankastockpicks.blogspot.com/2011/02/hnb-assurance-profits-up-on-growing.html
HNB Assurance PLC, controlled by Hatton National Bank PLC which owns a 59.99 stake in the insurance company, has recorded a 20 percent increase in profits after its general and life insurance businesses grew during 2010.
Net profits amounted to Rs. 241.7 million as at year ending December 31, 2010, up 20 percent from Rs. 201.6 million a year ago, the company’s unaudited accounts submitted to the Colombo Stock Exchange showed.
The company’s gross written premium grew by 15 percent during the year to Rs. 2,428.1 million during the year from Rs. 2,036.7 million while premiums ceded to reinsurers amounted to Rs. 449.4 million, a one percent decline from the previous year.
Gross written premium for its general insurance business reached Rs. 1,343.7 million, up 18.83 percent from Rs. 1,130.7 million a year ago. Life insurance gross written premium amounted to Rs. 1,084.4 million, up 10.11 percent from Rs. 984.8 million a year ago.
HNB Assurance saw revenues increase by 16 percent to Rs. 2,361.2 million for the financial year ending December 31, 2010 from Rs. 2,036.7 million a year ago.
Insurance claims during 2010 amounted to Rs. 648.1 million, a 27 percent increase from Rs. 511.9 million in 2009.
The insurance company’s investment income amounted to Rs. 517.1 million, up 11 percent from Rs. 467.8 million a year ago.
The net asset value per share as at December 31, 2010 amounted to Rs. 27.1.
The company’s total investments amounted to Rs. 3,403.9 million during the year, up 25.26 percent from 2,717.4 million a year ago.
Rienzie T. Wijetilleke is the Chairman of HNB Assurance PLC while Manjula de Silva is the company’s Managing Director/CEO.