[Click eStock] "Hanwha General Insurance Expects Record High Profit This Year"

[Asia Economy Reporter Ji Yeon-jin] Hana Financial Investment stated on the 29th that it expects Hanwha General Insurance to achieve record-high profits this year and maintains a buy investment opinion with a target price of 6,000 KRW.

Lee Hong-jae, a researcher at Hana Financial Investment, said, "In the first half of the year, the company already exceeded last year's annual performance by 16.5%, and with favorable automobile L/R continuing in the third quarter, strong results are expected, so the annual profit this year is projected to reach an all-time high." He added, "Despite 'With Corona,' long-term risk L/R is expected to improve."

The annual net profit is estimated to increase by 92.3% compared to the previous year, reaching 170 billion KRW. For the third quarter, net profit is expected to record 55.1 billion KRW, a 162.9% increase year-on-year, surpassing market expectations.

The researcher stated, "It is true that the CSM ('Contract Service Margin') retrospective period is expected to be somewhat shorter compared to major non-life insurers, and the recent growth rate of protection-type new contracts has somewhat slowed, resulting in relatively low expectations for the introduction of IFRS17." However, he added, "As of the first half, the LAT (Liability Adequacy Test) surplus ratio reached 59.3%, and with the pre-recognition of loss contracts easing the profit and loss burden after IFRS17, the non-loss L/R, which will play an important role in long-term profits and losses, is stably maintained within 80%. Therefore, the current stock price is excessively undervalued."