[Edaily Reporter Kwon Oh Seok ] NH INVESTMENT & SECURITIES announced on the 1st that it is maintaining its “Buy” rating and target price of 46,000 won for Hyundai MARINE & FIRE INSURANCE CO.,LTD(001450).

Jeong Jun-seop, an analyst at NH INVESTMENT & SECURITIES, stated, “Although the stock is undervalued due to the suspension of dividends, its fundamentals are steadily improving.” He added, “While the underwriting loss remains negative, the magnitude is gradually narrowing, and there are no signs of further deterioration in the auto insurance segment.”
He further explained, “Starting in July, managed reimbursement is scheduled to be implemented for manual therapy and extracorporeal shockwave therapy; provided the balloon effect is not significant, we expect this to improve losses by approximately 15 billion won per quarter. Improvements in asset and capital soundness are also positive.”
Researcher Jeong noted, “Through appropriate premium rate increases, the company is avoiding excessive competition for new contracts and improving efficiency metrics, while maintaining the K-ICS ratio in the 200% range and managing the burden of surrender value reserves.” He added, “Although there are no distributable profits yet, dividends are expected to resume once relevant regulatory improvements are implemented.”
Net income for the second quarter is projected at 2817억원 (up 13.7% year-over-year). He explained, “We forecast net income to exceed market expectations, driven by insurance profit of 3007억원 and investment profit of 877억원,” adding, “We expect the underwriting loss to narrow compared to the first quarter due to the increase in expected insurance claims resulting from the premium rate hike.”
He further added, “Although the guidelines for loss ratio and operating expense assumptions are scheduled to be reflected starting in the second quarter, the overall impact is expected to be minimal as deteriorations and improvements across different segments will offset each other,” and noted, “We plan to mitigate the decline in the CSM (Contractual Service Margin) multiple for new contracts resulting from the assumption changes through preemptive premium rate increases.”