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GICRE: Higher Multiple And Margin Pressure Will Likely Limit Future Upside

Climate Catastrophes And Digital Disruption Will Erode Underwriting Margins

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GICRE
AnalystLowTarget
Not Invested
Published 23 Jun 2025

Update shared on 15 Dec 2025

Fair value Increased 75%
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AnalystLowTarget's Fair Value
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1Y
-27.1%
7D
-4.4%

Analysts have raised their price target on General Insurance Corporation of India significantly, lifting fair value from ₹197 to ₹345. They are factoring in slightly higher revenue growth expectations, a modest uptick in the discount rate, and a rerating in future earnings multiples despite a marginally lower projected profit margin.

What's in the News

  • Board meeting scheduled on November 12, 2025, to review and approve unaudited standalone and consolidated financial results for the quarter and half year ended September 30, 2025, along with other routine business matters (company filing)
  • Ministry of Finance entrusts financial and administrative powers of Chairman and Managing Director to Executive Director Hitesh Ramesh Chandra Joshi from October 1, 2025, for up to three months or until a regular CMD is appointed, whichever is earlier (Ministry of Finance communication)
  • Hitesh R. Joshi, a senior GIC-Re executive with extensive experience across reinsurance, retrocession, finance, audit, investor relations, HR, IT, business intelligence, and actuarial functions, assumes interim CMD responsibilities (company disclosure)
  • Term of former Managing Director Ramaswamy Narayanan ends on superannuation on September 30, 2025, resulting in his cessation as MD with effect from close of business that day (company announcement)

Valuation Changes

  • Fair Value: Raised significantly from ₹197 to ₹345, indicating a substantial upgrade in the estimated intrinsic value of the stock.
  • Discount Rate: Increased slightly from 12.73% to 12.76%, indicating a marginally higher required return in the valuation model.
  • Revenue Growth: Revised up from 7.55% to 8.39%, reflecting modestly stronger medium term growth expectations.
  • Net Profit Margin: Trimmed slightly from 12.32% to 11.70%, incorporating expectations of somewhat higher costs or claims.
  • Future P/E: Rerated sharply higher from 6.31x to 11.28x, suggesting a materially more optimistic view of future earnings multiples.

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Disclaimer

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