Allianz Malaysia Berhad (Allianz) is seen as being fundamentally sound as it’s still posting above average general and life insurance growth.
MIDF Research, which initiates coverage on Allianz with a BUY call and a TP of RM23.37, said today (May 10) Allianz exhibits a market leading position and global presence gives it an edge within an oversaturated industry. Its regional development centre helps it hold its own against upcoming digital insurers and InsureTech players.
MIDF expressed that the insurer’s solid dividend yields (of 6-7%), while fundamentally strong is well equipped to handle future challenges along with Allianz being in the industry’s leading position which offers an edge in the competitive insurance space.
Allianz has also the ability to leverage support, branding and knowledge sharing from Allianz SE (its parent company) and fellow subsidiaries. It has also recently set up its regional development centre to aid digitisation processes.
MIDF added that Allianz encounters low insurance penetration among Malaysians but they see that demographic factors, macro-trends and government-led initiatives work in Allianz’s favour.
The insurer has a lower-than-average management expense ratio (for AGIM) attributable to economies of scale. MIDF added.
