Al Ahlia Insurance posts strong half-yearly results backed by solid growth in profit

MUSCAT: Al Ahlia Insurance declared its unaudited interim results for the first 6 months of 2017, recording a growth of 14.5 per cent in net profit after tax from RO 2.24m in H1 2016 to RO 2.56m in H1 2017. The net underwriting profit increased by 9.6 per cent from RO 2.10m to RO 2.30m and investment income increased by 41.4 RO from RO 0.52m to RO 0.74m in H1 2017 over H1 2016. Commenting on the results, Lloyd East, (pictured) Regional CEO, RSA (Middle East) & Managing Director of Al Ahlia said: “Despite the challenging environment for the industry, we have delivered strong growth in net profits due to our continued commitment and focus on profitability and providing best-in-class customer services. Our investment income has grown as a result of restructuring in our investment portfolio”
At the IPO price, the Company offers an attractive average projected dividend yield of 9.3 per cent per annum for the first four years ie 2017-2020. The first dividend of bzs 11 per share is expected to be paid by the Company in August/September 2017 with semi-annual dividend distributions thereafter.
Leading research analysts have recommended subscribing to the IPO of Al Ahlia Insurance Company and anticipate potential upside on listing. “We recommend investors to subscribe to the IPO of Al Ahlia Insurance Company… The issue price of RO 0.300 offers upside potential of 10.4 per cent to our 12 month fair value of RO 0.331/Share.” — United Securities.
“We arrive at a fair value of RO 0.320 per share for Al Ahlia Insurance Company” — FINCORP
Earlier, U-Capital had issued its IPO note with a recommendation to ‘Subscribe’ to the IPO and a fair value of RO 0.350 per share implying a potential upside of 16.6 per cent to the IPO price of RO 0.300 per share.
Gulf Bader Capital Markets commented on the strong half-yearly unaudited results in their report. “H1 2017 remain strong and supportive of the dividends… Net profits are above the full year IPO projections for 2017.” Other research analysts have also commented positively.
Based on the strong response, leading banks including bank muscat and Oman Arab Bank are providing financing for IPO for the retail investors. To avoid rush on the last day, investors should plan to complete and submit their applications at the earliest. The applications can be submitted at any branch of Bank Muscat, Oman Arab Bank, Ahlibank, Bank Sohar, National Bank of Oman and BankDhofar before close of official banking hours on August 2, 2017.
Bank Muscat Investment Banking is the Financial Advisor & Issue Manager to the IPO.
Al Ahlia is a leading property and casualty insurer in Oman backed by strong promoters led by RSA Insurance Group and well supported by experienced local shareholders.