[Click eStock] "Hyundai Marine & Fire, Current Stock Price Severely Undervalued... A Buying Opportunity at Low Price"

[Asia Economy Reporter Park Jihwan] Hana Financial Investment stated on the 15th that the current stock price level of Hyundai Marine & Fire Insurance appears to be excessively undervalued and suggested that this should be taken as a buying opportunity at a low price. They maintained a 'Buy' investment rating and a target price of 38,000 KRW.

Researcher Lee Hongjae of Hana Financial Investment said, "Currently, Hyundai Marine & Fire Insurance's stock price seems to reflect worries without any expectations," adding, "the increase in next year's actual loss insurance premiums will be decided by December, and the Financial Supervisory Service meeting this week is expected to mention the direction of automobile insurance premiums, so the current period is one of high regulatory uncertainty."

Since the repair cost has been raised by 4.5%, it is expected that automobile insurance premiums will not be lowered immediately but will be reduced in the second half of next year after applying the effects of system improvements. Even if lowered immediately, it is forecasted that it will not affect next year's risk loss ratio (L/R). Researcher Lee Hongjae projected, "Due to the improvement in the personal injury insurance payment system starting in 2023, there is no need to be overly concerned about the mid- to long-term L/R direction."

He said, "Actual loss insurance is estimated to see an increase in loss size this year due to claims such as cataract surgery, so for first- and second-generation products, premiums are expected to rise by a similar range (mid-teens around 10%) compared to the previous year," adding, "Third-generation products will also be able to adjust premiums starting next year." Furthermore, he emphasized that the share of third-generation products will expand to 19% after the first half of the year, making its impact far from insignificant.

Researcher Lee Hongjae stated, "The current price-to-book ratio (P/B) of 0.4 times and price-to-earnings ratio (P/E) of 4.0 times represent excessive undervaluation," adding, "Considering the IFRS17 expectations and a high dividend yield of 6.5%, this is judged to be a buying opportunity at a low price."

This content was produced with the assistance of AI translation services.