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Title PVI_BUY_TP 59,300_Strong position in Non-life Insurance_BSC Company Update
Report Type Phân tích công ty
Source BSC
Bussiness PVI
Detail Date : 12/04/2022
Total pages : 10
Language : English
File Type : .PDF
FileSize : 942 Kb
Download: 426
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Short Content

Valuation 

BSC recommends BUY PVI shares with the recommended price of 59,300 VND/share (equivalent to 20.5% upside compared to the closing price on January 28, 2022 at 49,200 VND/share) with a target PB = 1.6x .
 
Forecasting business results
BSC forecasts PVI's revenue and net profit in 2022 to reach VND 4,511 billion (+11.8% yoy) and VND 951 billion (+8.1% yoy), EPS FW = 3,824 VND/share assuming (1) Insurance premium revenue original insurance growth 10.1% yoy ; (2) The combined ratio increased to 95.3%, of which the loss ratio increased to 32.1% ; and (3) The gross and net return on investment of investment assets are 8.4% and 7.5%, respectively. (increase by 0.1 percentage point and 0.4 point % respectively) .
 
Investment perspective
  • PVI's non-life insurance premium is expected to grow by 10.1% in 2022 ;
  • PVI maintains a stable market share of over 15%, with a nationwide network of branches and a large customer base of the PVN system ;
  • Financial profit improved thanks to increased proportion of bond investment.
Catalyst
  • PVIRe raises capital to help raise retention rate & credit rating
  • The divestment from PVN may help PVI be valued at a higher price in the near future .
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Risks
  • The prolonged epidemic affects the growth of insurance premium revenue.
  • Lower interest rates reduce PVI's financial profit.
 
Business Update
In 2021, PVI's revenue and NPAT will reach VND3,606 billion (-4.9% yoy) and VND245 billion (+26% yoy) respectively due to (1) insurance business expenses down 1.2% yoy, (2) expenses claims and reserves decreased 6.7% yoy, and (3) finance revenue increased 7.3% yoy .