Shares of ICICI Lombard General Insurance dropped nearly 15% on Thursday morning as the company’s June quarter earnings fell short of market expectations. The profit was impacted by higher claims and additional reserve provisions. The stock hit a fresh 52-week low of Rs 1,544.40 on the BSE during early trade.
At 11:35 am, the stock was trading at Rs 1,614.30, marking an 11% decline from the previous day’s close of Rs 1,814. The company reported a 46% year-on-year decrease in net profit to Rs 403.17 crore for the April-June quarter of FY27, down from Rs 747.08 crore in the same period last year.
The decline was attributed to higher claims and a Rs 165-crore reserve provision for its motor third-party portfolio. ICICI Lombard General Insurance also faced two significant fire losses totaling Rs 63 crore during the quarter, impacting its combined ratio by one percentage point.
The company mentioned that a Supreme Court judgment negatively affected the combined ratio by 2.8 percentage points, pushing it to 107.2% in the June quarter from 102.9% a year ago. Despite these challenges, the firm expects fire portfolio losses to normalize and remains optimistic about the long-term growth potential of its health insurance business.
Analysts at Motilal Oswal Financial Services downgraded the stock to ‘neutral’ from ‘buy’ due to the weak quarterly performance. Over the past year, the stock has underperformed, declining by nearly 20% and dropping over 10% in the last six months.
