MBSB Investment Bank maintained its BUY call on Allianz Malaysia Bhd with an unchanged target price of RM26.77, implying 23.4% upside, as the insurer’s growth trajectory remained intact despite near-term claims pressure. MBSB said the strong rebound in total industry volume (TIV) should support the motor segment while Allianz Life Malaysia’s bancassurance and employee benefits businesses continue to outperform.
Allianz Malaysia’s 6MFY26 core net profit rose 4% year-on-year to RM446 million, accounting for 47% of both MBSB’s and street full-year forecasts. Gross written premiums increased 12% to RM298 million, with Allianz General Insurance Company Malaysia (AGIC) up 7% and Allianz Life Insurance Malaysia (ALIM) gaining 16%.
AGIC’s profit before tax fell 5% to RM298 million as higher claims offset stronger insurance revenue and lower reinsurance expenses. Its combined ratio also increased to 88.3%. However, MBSB noted that motor claims inflation has remained limited, which management attributed to stronger underwriting standards.
The research house said the motor outlook has improved following a sharp recovery in TIV, which reached record levels in June. Non-motor growth remained softer due to weaker fire, engineering and marine segments, although AGIC continues to outperform the wider industry.
ALIM delivered stronger growth, with profit before tax rising 14% to RM294 million. MBSB highlighted bancassurance and employee benefits as key growth drivers while medical inflation remains a concern for the healthcare segment.
MBSB expects some headwinds from claims inflation and medical costs but said these should not derail Allianz Malaysia’s broader growth trajectory, maintaining its RM26.77 target price.
As of 10.22 am, the stock price gained 1.47% to RM22.02.
