ICICI Lombard, a leading private sector general insurer, showcased robust financial performance in the fourth quarter of the fiscal year 2023-24, with a notable surge in net profit propelled by substantial growth in premium income and investment returns.
The insurer reported a significant 18.9% increase in net profit, reaching Rs 519.50 crore in the January-March quarter, compared to Rs 436.96 crore in the corresponding period of the previous year. This surge underscores the company’s resilience and strategic focus amidst evolving market dynamics.
Sequentially, the net profit witnessed a remarkable growth of 20.40% from Rs 431.46 crore in the preceding quarter of FY24, reflecting sustained momentum and effective operational management.
Driving the impressive financial results was the substantial rise in the gross direct premium income (GDPI), which surged by 22% to Rs 6,073 crore in Q4 FY24, compared to Rs 4,977 crore in Q4 FY23. Moreover, the net premium income rose by 17.23% year-on-year to Rs 4,368 crore, indicating strong traction in core business operations.
Additionally, the company’s net investment income registered a commendable growth of nearly 15% year-on-year, amounting to Rs 765.55 crore, reflecting prudent investment strategies and favorable market conditions. Despite fluctuations, capital gains remained robust at Rs 156 crore in Q4 FY24.
Furthermore, ICICI Lombard demonstrated effective risk management, as evidenced by a notable improvement in the combined ratio, which stood at 102.2% in Q4 FY24, compared to 104.2% in Q4 FY23. This signifies enhanced operational efficiency and underwriting discipline.
For the full fiscal year 2023-24, the company witnessed a substantial growth trajectory, with GDPI soaring by 17.8% year-on-year to Rs 24,776 crore from Rs 21,025 crore in FY23. Excluding crop and mass health segments, the GDPI growth stood at 17.1% year-on-year, highlighting the company’s diversified portfolio and market penetration.
Moreover, ICICI Lombard exhibited prudent risk management practices throughout FY24, as reflected in the combined ratio of 103.3%, compared to 104.5% for FY23. Excluding the impact of catastrophes, the adjusted combined ratio stood at 102.5%, underscoring the company’s commitment to sustainable profitability.
Gopal Balachandran, CFO of ICICI Lombard, expressed optimism regarding future prospects, stating, “The market momentum that we are seeing in the way things are getting shaped up, we would obviously explore opportunities in terms of how we could look at accelerating that 102% combined by the end of FY25.”
In line with its commitment to shareholder value creation, the company’s board of directors proposed a final dividend of Rs 6 per share for FY24. This dividend payout, subject to shareholder approval in the upcoming annual general meeting, reflects the company’s strong financial position and cash flow generation.
In conclusion, ICICI Lombard’s robust performance in Q4 FY24 underscores its resilience, strategic agility, and commitment to sustainable growth amidst dynamic market conditions. With a strong foundation and prudent financial management, the company is well-positioned to capitalize on emerging opportunities and deliver long-term value to its stakeholders.
