Result Analysis: ICICI Lombard General Insurance Company Ltd. (CMP: Rs.1130) Result Update: Q4FY23

ICICI Lombard General Insurance Company Ltd. (ILGI) is one of the leading private sector non-life insurer in India with 8.2% market share as of 31st March, 2023. It offers a well-diversified range of products which includes Motor, Health, Fire, Marine, Crop & other insurance products. The company’s key distribution channels are direct sales, individual sales, corporate agents, brokers and digital channel. With a well-developed and integrated distribution network, the company caters to the demands of its various clients, including individuals, corporations, MSMEs, and government agencies, through both online and offline channels.


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    Stock Details
    Market Cap. (Cr.) 55524.94
    Equity (Cr.) 491.13
    Face Value 10
    52 Wk. high/low 1410 / 1049
    BSE Code 540716
    Book Value (Rs) 205.36
    Sector Insurance



    Key Ratios
    Debt-Equity: 0.04
    ROCE (%): 18.62
    ROE (%): 15.36
    TTM EPS: 32.67
    P/BV: 5.50
    TTM P/E: 34.61

    Result Highlights:

    • ICICI Lombard reported increase of 12% YoY and decrease of 2% QoQ in the net premium earned due to lower premium income in the fire, crop and motor segments. Company’s Net Profit has increased by 24% QoQ and 40% YoY to Rs.437 cr. mainly driven by the increase in other income.
    • Motor insurance segment which accounted 56.4% of the net premium earned, has shown sluggish performance in the quarter, net premium earned through the segment has de-grew by 1.9% QoQ. In FY23, Private cars Gross Direct Premium Income has de-grew compared to marginal increase in the Two-wheeler and Commercial vehicle segments. The Loss ratio from the Motor segment has grown over the years and is at 72.4% in FY23.
    • The Health insurance segment showed marginal increase of 0.9% QoQ in the Q4; the loss ratio of the segment has declined significantly from 91.7% of FY22 to 77.3% in FY23.
    • Solvency ratio of the company is at 2.51x as of March’23 compared to 2.45x of December’22, which is higher than the minimum regulatory requirement of 1.5x.
    • Claim ratio of the company has increased by 390 bps QoQ and 220 bps YoY to 74.2% in the quarter majorly due to the increased loss ratio in the motor and property & Casualty segment.
    • Board of the company approved final dividend of Rs.5.50/share.

    Financial Performance:

    Financia- Performance-Lamboard

    Shareholding Pattern:

    Particulars (In %) Q4FY23 Q4FY22
    Promoters Group 48.02 48.04
    FIIs 23.94 27.33
    DIIs 16.84 13.74
    Public 6.7 6.35
    Others 4.5 4.5


    Con-call Highlights:

    • There are indications of improvement in the motor insurance industry’s combined ratio, and ICICI Lombard has implemented a price increase for Motor OD.
    • A 19% price hike has been announced solely for the renewal book of retail health, with the aim of improving loss ratios that are limited by health inflation. It is expected that over time, the health indemnity loss ratio will fall within the 65-70% range.
    • The company has a positive outlook on achieving its combined ratio target of 102% by the fiscal year 2025.


    ICICI Lombard has shown slightly below broader estimates results in the March’23 quarter with 2% QoQ decrease in the Net premium earned and 24% QoQ increase in the Net profits mainly due to higher other income. The growth of the motor segment is expected to be primarily in the latter part, as the company awaits the rationalization of pricing in the OD segment. Health segment would further benefit with price increase and the enhanced efficiency of the agency channel. The company remains key player in the non-life insurance industry in the country and has large underpenetrated market compared to the global average. We remain positive at the ICICI Lombard looking at the synergies arising from the merger with Bharti AXA, the benefits of scale, and an improvement in the health business mix resulting in improved ROE and combined ratio over the next few years.


    Particulars (In Cr.) Q4FY23 Q3FY23 Q4FY22 QoQ% YoY% FY23 FY22 YoY%
    Net Premium Earned 3,726 3,792 3,318 -2% 12% 14,823 13,032 14%
    Other Operating Income 793 767 703 3% 13% 3,053 2,994 2%
    Other Income 928 11 781 8236% 19% 995 810 23%
    Total Income 5,447 4,570 4,801 19% 13% 18,871 16,836 12%
    Total Operating Expenditure 4,883 4,104 4,402 19% 11% 16,674 15,198 10%
    Operating Profit 564 466 400 21% 41% 2,196 1,638 34%
    Provisions & Write Offs -9 1 -11 -1138% -17% 84 -45 -286%
    Profit Before Tax 573 465 410 23% 39% 2,113 1,684 25%
    Tax 136 113 98 20% 38% 383 413 -7%
    Profit After Tax 437 353 313 24% 40% 1,729 1,271 36%
    Segments Premium Income (In Cr.) Q4FY23 Income% Q3FY23 Q4FY22 QoQ% YoY%
    Fire 163 4.4% 168 185 -3.3% -12.3%
    Marine 118 3.2% 109 104 8.2% 14.0%
    Health including Personal Accident 1,133 30.4% 1,123 914 0.9% 24.0%
    Motor 2,102 56.4% 2,143 1,929 -1.9% 8.9%
    Miscellaneous 202 5.4% 204 180 -1.0% 12.6%
    Crop Insurance 8 0.2% 45 6 -82.1% 41.0%
    Total 3,726 100% 3,792 3,318 -1.7% 12.3%
    Ratios (%) Q4FY23 Q3FY23 Q4FY22 QoQ YoY FY23 FY22 YoY
    Combined Ratio 104.2 104.4 103.2 -20 bps 100 bps 104.5 108.8 -430 bps
    Expense Ratio 31.4 31.2 31.5 20 bps -10 bps 29.6 30 -40 bps
    Solvency Ratio 251 245 246 600 bps 500 bps 251 246 500 bps
    Incurred Claim Ratio 74.2 70.3 72 390 bps 220 bps 72.4 75.1 -270 bps
    Retention Ratio 75.8 74.3 79.5 150 bps -370 bps 71.4 72.7 -130 bps
    Source: Company website, EWL Research

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