Solid franchise to weather challenges, reiterate Overweight
Overweight on 4% lower TP of SAR146/share. Our updated valuation for Bupa factors in lower growth assumptions and underwriting margins, as benign market conditions are likely to continue at least in 1H17. We lower our GWP forecasts for 2017-19 by 10% p.a., in line with our updated sector assumptions and raise Bupa’s loss ratio by an average of 130bps. This is partially offset by the rolling over of our valuation by 1 year. Bupa continues to have a strong foothold in Saudi’s health insurance market amid a relatively superior profitability. Bupa trades on a 2017e P/B of 4.1x, a 31% premium to Saudi healthcare peers, against higher sustainable RoE of >30%.
Bupa Arabia For Cooperative Insurance is engaged to transact cooperative insurance operations and related activities in the Kingdom of Saudi Arabia in accordance with its articles of association, and applicable regulations in the Kingdom of Saudi Arabia. Co. underwrites medical insurance only.
CI Capital is a diversified financial services group and Egypt’s leading provider of leasing, microfinance, and investment banking products and services.
Through its headquarters in Cairo and presence in New York and Dubai, CI Capital offers a wide range of financial solutions to a diversified client base that include global and regional institutions and family offices, large corporates, SMEs, and high net worth and individual investors.
CI Capital leverages its full-fledged investment banking platform to provide market leading capital raising and M&A advisory, asset management, securities brokerage, custody and research. Through its subsidiary Corplease, CI Capital offers comprehensive leasing solutions, including finance and operating leases, and sale and leaseback, serving a wide range of corporate clients and SMEs. In addition, CI Capital offers microfinance lending through Egypt’s first licensed MFI, Reefy.
The Group has over 1,700 employees, led by a team of professionals who are among the most experienced in the industry, with complementary backgrounds and skill sets and a deep understanding of local market dynamics.
CI Capital has been recognized as the “Best Investment Bank in Egypt” by EMEA Finance for four years running from 2013-2016, and by Global Finance in 2014 and 2015.
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