There are around 5000 companies are listed in the Stock market out of which around 1600 companies are listed at NSE. According to the businesses of the companies, they have been classified into different sectors like FMCG, Banking, Finance, Insurance, chemicals, etc...
There are 58 insurance companies in India out of which 24 are life insurers and 34 are Non-life insurers means they are running their business in general insurance.
In this article, we are going to discuss the 4 insurance sector stocks you should invest in. Read on!!
4 Best Insurance Company's stocks to buy in India!
1. HDFC Life
Pic credit; The Free Press Journal
HDFC Life Insurance company Ltd. is a long-term insurance providing company and it is one of the leading private life insurers in the life insurance industry in India. The company is a joint venture between one of India's leading financial institutions, HDFC (Housing Development Finance Corporation Ltd.), and a global investment company, Standard Life Aberdeen. As of 31st March 2020, the holding of HDFC ltd. is 51.69%, and the holding of Standard Life Aberdeen is 34.75% in the company. The remaining equity is held by public shareholders.
If we talk about the product portfolio of the company then it offers products like pension, protection, savings, investment plans.
The current market capitalization of the company is Rs.1,37,962 crores and the stock is currently trading at a price of Rs.682.60. The company's stock has generated a return of 36.55% in the last one year.
The stock is categorized as a low-risk stock as it is 1.38x as volatile as Nifty which means the stock is best suited for you if too many ups and downs in the chart scare you.
If we talk about the financials of the company, the company has reported a minor growth of 2.38% in profit after tax (PAT) in the 4th quarter of FY 2021 on yearly basis.
Also read; 8 Banking stocks to buy in India in 2021!
2. ICICI Lombard
pic credit; thesmeindia.com
ICICI Lombard General Insurance Company Limited is a general insurance company and it is the largest private sector general insurance company in India. It is a joint venture between India's second-largest bank, ICICI Bank, and Fairfax Financial Holdings Limited. The company's promoters have the majority of stake 51.88% in the company and 29.08% stake has been held by foreign institutions.
ICICI Lombard provides products like health insurance, car insurance, personal accident insurance, two-wheeler insurance, commercial vehicle insurance, travel insurance, home insurance, and whether insurance.
With a Market capitalization of Rs.68,912 crores, ICICI Lombard is a large-cap company. The stock is currently trading at a price of Rs.1515.75 and it has compounded its shareholder money at a CAGR of 14.9% in the last one year.
ICICI Lombard acquired Bharti Axa General Insurance in August 2020 through a share swap deal.
If you scare off too many ups and downs in the stock price then this stock is best suited for you as it has been categorized in low risks stocks.
The company has reported massive growth in the Jan-march quarter of FY2021 of 23.8% in net profit on a year-on-year basis.
3. ICICI prudential life insurance
pic credit; VCCircle
ICICI Prudential Life Insurance Company Limited is a life insurance company in India and it is a joint venture between ICICI Bank and Prudential plc. Promoters have the highest stake in the company which is 73.48% and after that Foreign institutional holdings have 16.51% stakes in the company.
It offers products like term plans, Investment plans, retirement or pension plans, and ULIPs (Unit links investment Plans).
The current market capitalization of the company is Rs.83,281 crores indicating that it is a large-cap company and the stock is currently trading at a price of Rs.579.75. In the last one year, It has generated a return of 48.24% CAGR.
Again, if you don't like too much volatility then you should give some space to this stock into your portfolio as this stock will give stability to your portfolio and also have the potential to generate good returns if you can hold the stock for the long term.
When we have a look at the financials of the company, then it has reported a fall of 64% in the net profit in the quarter of Jan-March of the FY2021 on yearly basis.
4. SBI Life Insurance
pic credit; money control
SBI Life Insurance Company Ltd. is a joint between the largest public sector bank in India, State Bank of India, and BNP Paribas Cardif which is a French multinational bank and financial services company that has global headquarters in Paris. SBI is the highest shareholder with a stake of 55.5% whereas, BNP Paribas Cardif has a 22% stake in the company.
SBI Life Insurance is one of the leading life insurance companies in India and its product portfolio includes term insurance, investment plans, saving plans, and retirement plans.
SBI life insurance is a large-cap company with a market capitalization of Rs.98,280 crores. The company's stock is currently trading at a price of Rs.988.10 and it has generated a return of 32.58% in the last one year.
The stock will give stability to your portfolio as it has been categorized into the low risks stocks and it also has the potential to generate good returns if you can go for the long run.
If we talk about the financials of the company, then it has reported a minor growth of 0.32% in profit after tax (PAT) in the Jan-March quarter of the financial year 2021 on yearly basis.
Why we should invest in Insurance stocks?
1. The life insurance industry is expected to increase at a CAGR of 5.3% between 2019 to 2023.
2. The market share of private sector companies has been increased from 47.97% to 48.03% in the general and health insurance industry in 2020 as compared with 2019.
3. The more vehicles people will purchase the more will insurance companies will earn as vehicle insurance is mandatory in India.
4. Increasing demand for health and life insurance due to covid-19. It's a fact that this pandemic has taught the value of health and life insurance to too many people. So we can see a huge rise in the health and life insurance industry in the future.
Also read; Top 10 stock brokers in India!
The Bottom Line...
Above all the stock prices and Market capitalizations are as of 13th of June 2021 and these may be changed as the stock prices will be changed. The Author is just sharing his opinion meanwhile he is not giving you any stock advice.
So, let's end the article with these 4 best insurance company's stocks. If you liked the article, do share it with your friends and your loved ones and if you have any doubts in your mind please feel free to comment down. Goodbye and Happy Investing!!✌✌
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