ICICI Prulife to move higherFrom the previous high of 412, the stock has found support at the retracement zone between 61.8% and 50%. The fib extn targets are pointing for targets 419,427 and 453 in the near term.
ICICIPRULI trade ideas
ICICI Pru Life - A Budget Proof StockICICI Prudential Life Insurance Co. Ltd seems to have got its game right in insurance. The private sector insurer’s net profit grew 3.3% to Rs450 crore for the quarter ended December as its new business premium grew at an impressive 47% to Rs1,780 crore.
The company clearly gained market share during the quarter, perhaps assisted by the government’s demonetization drive. According to its presentation to investors, ICICI Prudential Life Insurance Co. has a market share of 13% in the April-December period on the basis of retail weighted received premium.
The annualized premium equivalent rose 27.6% to Rs4,458 crore for the nine-month period ended December.
But mere strength in new business may not be enough as insurance is a long-term bet. Here too, the private sector insurer scores as it is evident that customers do stick with the company. Its persistency ratios for 13th month rose to 81.4% from 76.8% a year ago. Those for the 25th and the 37th month, too, rose from a year ago.
The value of new business margin increased to 9.4% for April-December from 8% in the corresponding period in fiscal year 2016.
ICICI Prudential Life Insurance Co. seems to have gotten its expenses to behave as well. The cost of total weighted received premium was 15.9% for the nine months ended December, a marginal slip from 16% for the same period in FY16. Its expense ratio excluding commission was down to 12.2% from 12.5% a year ago.
The private sector insurer sells its policies by using its parent ICICI Bank Ltd’s network of branches, besides using agents.
But the fact that ICICI Prudential Life Insurance Co.’s shares have gained more than 20% since 1 November shows that investors had expected a stellar set of numbers. The stock beat the benchmark Sensex in returns for the period. But given that the third quarter had the unexpected event of demonetization, the results have been quite decent.
ICICI Prudential Life Insurance assures profits in near futureScrip is at Rs 375 going strong, Elliott Wave 3 in progress which should take it upto 420 or so before correcting in Wave 4.
Volumes are good and going above average consistently.
Fundamentally company is doing well. It is the only Insurance scrip available and it is just next to LICI in sale volumes, growth and goodwill.
Warren Buffet has stated that profits from a good Insurance company can be mind boggling.
Just go for it and keep it for long term.
ICICIPRULI retraced to the levelICICIPRULI retraced to the level. Risky trade but taking the chance.
Entry @ 350
Stop loss @ 346
Target @ 362 ( 3:1)
Buy ICICI Prudential -NSE IndiaThe stock is acting well in the limited trading history available. Higher targets of 400 plus possible in the coming weeks. Investors are advised to Buy on dips with stops near 320 levels. The bullishness in the stock will continue till the interest rates tend lower.
