South African (JSE) Insurance Industry Analysis

Industry Valuation and Performance

Has the South African Insurance Industry valuation changed over the past few years?

Date	Market Cap	Revenue	Earnings	PE
Tue, 30 Nov 2021	R390.4b	R721.1b	R22.8b	20x
Thu, 28 Oct 2021	R441.1b	R720.9b	R22.7b	21.1x
Sat, 25 Sep 2021	R430.3b	R720.9b	R22.7b	20.3x
Mon, 23 Aug 2021	R416.1b	R719.9b	R21.2b	21.5x
Sat, 10 Jul 2021	R398.4b	R719.9b	R21.2b	19x
Fri, 02 Apr 2021	R388.1b	R609.4b	R9.5b	29.1x
Mon, 04 Jan 2021	R398.2b	R499.2b	-R2,281,581,000.00	37.3x
Thu, 08 Oct 2020	R352.6b	R470.8b	-R1,340,380,000.00	31.2x
Wed, 01 Jul 2020	R368.6b	R442.0b	-R389,179,000.00	82.9x
Sat, 04 Apr 2020	R326.7b	R520.7b	R16.6b	16.4x
Tue, 07 Jan 2020	R491.4b	R599.1b	R33.7b	12.6x
Mon, 30 Sep 2019	R471.2b	R548.6b	R33.4b	12.2x
Thu, 04 Jul 2019	R520.5b	R498.1b	R33.0b	13.5x
Sun, 07 Apr 2019	R494.5b	R438.3b	R29.6b	13.7x
Wed, 09 Jan 2019	R532.3b	R378.6b	R26.2b	14x

PE Ratio

14.3x

Fri, 07 Dec 2018

Current Industry PE: Investors are relatively neutral on the industry at the moment, considering it's trading close to its 3-year average PE ratio of 25.3x. It appears they believe that earnings will grow in-line with historical growth rates.

Past Earnings Growth: The earnings for companies in the Insurance industry have declined 3.4% per year over the last three years, while revenues for these companies have grown 17% per year. This means that although more sales are being generated, either the cost of doing business or the level of investment back into businesses has increased, which has decreased profits.

Industry Trends

Which industries have driven the changes within the South African Insurance industry?


General Insurance	10.00%
Property and Casualty Insurance	4.31%
Life and Health Insurance	-5.48%

Industry PE: Investors are most optimistic about the Life and Health Insurance industry even though it's trading below its 3-year average PE ratio of 28.9x. However analysts are expecting annual earnings growth of 26%, which is lower than the prior year's growth of 140% per year. So the market might believe that analysts are underestimating future growth. Meanwhile, investors are most pessimistic about the Property and Casualty Insurance industry, which is trading below its 3-year average of 22.4x.

Forecasted Growth: Analysts are most optimistic on the Life and Health Insurance industry, expecting annual earnings growth of 26% over the next 5 years. However this is lower than its past earnings growth rate of 140% per year. Meanwhile, the Property and Casualty Insurance industry is expected to see its earnings grow by 20% per year over the next few years.

	Company	7D	1Y	Valuation
	SNT Santam	4.3%+R1.2b	7.1%	PE20x
	CND Conduit Capital	10.0%+R48.2m	327.8%	PS0.5x

Company

Valuation

SNT Santam

4.3%+R1.2b

7.1%

PE20x

CND Conduit Capital

10.0%+R48.2m

327.8%

PS0.5x

Brait PLC Reportedly Revives Plans to Exit Consol Glass

A consortium led by South African investment company Brait PLC (JSE:BAT) has revived plans to exit Consol Glass (Pty) Ltd., two sources said, possibly via an initial public offering (IPO) three years after a previous failed attempt. The private equity investors took Consol, which describes itself as sub-Saharan Africa’s largest glass manufacturer, private in 2007 for 6.1 billion rand, worth around $1 billion at the time. Brait’s interest in the company is held via its Brait Fund IV, which has a 29.7% stake in Consol. In 2018 the consortium, which also includes the private equity arm of insurer Old Mutual Limited (JSE:OMU) and Sanlam Limited (JSE:SLM), wanted to sell roughly a third of Consol to raise ZAR 3 billion, or around $250 million at the time after a depreciation in the value of the rand. That would have valued the entire company at around ZAR 10 billion. They have now appointed banks to advise them in their latest attempt at an exit, two sources, one directly involved in the discussions and another familiar with the matter, told Reuters. The options on the table include a second shot at an IPO, the source directly involved said, but declined to give any further details. Consol said in a statement its policy was not to comment on speculation but that it would advise all stakeholders accordingly in the event that any future IPO or change of ownership is concluded. “We do not speculate or provide comment on rumours pertaining to the asset owned or managed by Brait,” Brait told Reuters. Britain’s Barclays is one of the banks that is working with the consortium, both sources said. The second source familiar with the talks said the investment banking arm of local lender FirstRand, RMB, had also been appointed. Barclays and RMB declined to comment. Old Mutual and Sanlam did not immediately provide a comment. Three investment bankers told Reuters a series of exit attempts are on the horizon, especially in the industrials sector as South Africa slowly catches up with a trend already underway in the West.

South African (JSE) Insurance Industry Analysis

Industry Valuation and Performance

Industry Trends

Top Stock Gainers and Losers

Latest News

MTM

Non-Executive Independent Director Fatima Daniels has left the company

RMI

Non-Executive Director Obakeng Phetwe has left the company

DSY

Independent Non-Executive Director Brian Brink has left the company

CLI

Full year 2021 earnings released: EPS R1.17 (vs R0.98 in FY 2020)

SLM

Brait PLC Reportedly Revives Plans to Exit Consol Glass

OMU

Brait PLC Reportedly Revives Plans to Exit Consol Glass

SNT

Upcoming dividend of R4.32 per share

LBH

Liberty Holdings Limited's Ordinary Shares to Be Delisted

CND

Lead Independent Non-Executive Director has left the company