ALLIANZ MALAYSIA
Target Price: RM16.30
AFFIN Hwang Capital Research initiated coverage on Allianz Malaysia with a buy call, saying the market has yet to fully appreciate the company’s value, especially in its life operations.
It said this was despite the company’s strong share-price rally year-to-date.
At RM12.88, the research house said Allianz Malaysia remained undervalued.
Allianz Malaysia, the Malaysian arm of Allianz SE, is one of the largest insurers worldwide, with both the general and life operations housed under one roof in Malaysia.
“We like Allianz Malaysia due to its well-executed strategy and track record over the years as a composite-insurance player (general and life insurance) in Malaysia,” it said in a note.
The company is among the biggest insurance players in the country - it has the largest market share of gross-written premiums (GWP) at 11.8% in the general insurance segment, and it is the fifth-largest in the life insurance segment with 6.9% of annualised new premiums (ANP).
As part of the global Allianz Group, the research house noted that the company could directly benefit from a well-marketed brand and track record as well as tap into its parent’s or fellow subsidiaries’ customers in Malaysia.
“It also has access to the expertise and experience of its parent’s more established operations around the world.
“Such expertise and experience could be particularly useful as Malaysia is gearing up for the de-tariffication of motor and fire insurance, uncharted territory for the country’s insurance industry, but which has already been experienced by insurers in many other countries,” it said.