GIC Re posts net profit increase in latest financial quarter

GIC Re posts net profit increase in latest financial quarter | Insurance Business Canada

Reinsurance

Underwriting profits slumped compared to the same period last year

Reinsurance

By
Kenneth Araullo

GIC Re, the Indian public sector reinsurer, reported a 3.08% increase in net profit for the last quarter of FY24 (Q4 FY24) to ₹2,642.48 crore, compared to ₹2,563.84 crore in the same period the previous year. Sequentially, net profit rose 74.08% from ₹1,518 crore in Q3 FY24.

As per the Business Standard, for the full fiscal year FY24, GIC Re’s net profit was ₹6,497.30 crore, marking a 2.9% increase over the ₹6,312.50 crore recorded in the previous fiscal year. The company’s total assets stood at ₹1.78 trillion as of March 31, 2024, up from ₹1.57 trillion a year earlier.

In Q4 FY24, standalone net premium grew by 26.78% to ₹7,904 crore, compared to ₹6,234 crore in the year-ago period. Other income (less outgoings) recorded a profit of ₹217.30 crore, reversing a loss of ₹272.83 crore in Q4 FY23.

Underwriting profit for the quarter was ₹570.06 crore, down from ₹892.43 crore in the same period last year.

GIC Re’s management expenses dropped nearly 15% to ₹116.09 crore during the quarter, compared to ₹138.3 crore in the corresponding period last year. Net commission for the company increased by 80% year-on-year to ₹1,490.71 crore from ₹823.91 crore.

The company’s combined ratio improved to 89.26% in Q4 FY24, compared to 120.47% in Q3 FY24.

Earlier this year, it was reported that the Mumbai-based entity is also actively working to expand its international business as part of a strategy to diversify its revenue sources, according to its chairman and managing director, Ramaswamy Narayanan.

“We need to get our international credit rating to a level where we are able to attract and write the best businesses available in that market,” Narayanan stated, indicating a strategic pivot towards more lucrative and stable global insurance opportunities.

The reinsurer has also been engaging with international markets through government-led roadshows in major financial hubs such as New York, Hong Kong, Singapore, and Dubai. These efforts have reportedly received positive feedback from investors, potentially bolstering GIC Re’s position in these markets.

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