Insurance industry to be worth $400 bn by 2020: Report

NEW DELHI: India's insurance industry will outpace economic growth and is likely to reach $350-400 billion in terms of premium income by 2020, making it among the top three life insurance markets, an industry report revealed. 

India will also be among the top 15 non-life insurance markets by 2020, according to an industry study conducted by the Federation of Indian Chambers of Commerce and Industry (FICCI) and the US-based Boston Consulting Group. 

The report points out that penetration of the insurance industry, premium as percentage of the country's gross domestic product (GDP), has increased from 2.3 percent in 2001 to 5.2 percent in 2011. 

In addition, there has been a vast increase in the coverage of insurance. The number of life policies in force has increased nearly 12-fold over the past decade and health insurance, nearly 25-fold. 

Better terms and availability of a wide variety of products, like unit-linked products, whole life, maximum net asset value (NAV) guarantee, auto assistance, auto pay per km insurance, disease management and wellness, have boosted the growth of the industry. 

"While the industry has come a long way over the past decade, the big challenge is profitability. Private life insurers have accumulated losses of over Rs.16,000 crore till March 2010," said Alpesh Shah, partner and director of Boston Consulting Group India, the author of the report. 

"The non-life insurance industry has cumulative underwriting losses of nearly Rs.30,000 crore," he said. 

Commenting on the report, FICCI Director General Rajiv Kumar said: "The report estimates the total insurance premium at approximately Rs.17 lakh crore to Rs.22 lakh crore in 2020, with life insurance being Rs.15 lakh crores to Rs.20 lakh crores." 

"This growth will have a significant impact on India's ranking in the global insurance industry and is based on strong fundamentals," said Kumar. 

The report will be formally released at the 14th Insurance Conference in New Delhi Monday, FICCI said in a statement. 

"The report highlights the importance of insurance in Indian economy, the progress made in the last decade, key challenges associated with the sector and an action agenda for insurance companies and the government," said Sandeep Bakhshi, chairman of FICCI's insurance and pensions committee and managing director and chief executive of of ICICI Prudential Life Insurance.

Jubilant Food

Jubliant Food Works  (Consumer sector)

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Emkay Global Financial Services is bullish on Jubilant Foodworks and has recommended accumulate rating on the stock with a target of Rs 645 in its April 7, 2011 research report.

Jubilant FoodWorks (JFL) is comfortably placed to fund Dominos future expansion (Rs 0.6 billion/annually for 70 Stores) and Dunkin' Donuts network (Rs 0.3 billion/annually) from internal cash generation.

“We continue to like the extra topping in Dominos model i.e. gain from under-penetration of QSR (Quick Service Restaurants) in India, 

60% market share of pizza delivery market and return generating potential of business model. 

India offers all the triggers for sustainable long-term growth in QSR segment i.e.

(1) rising income levels

(2) rising urbanization

(3) rising proportion of workingwoman population and 

(4) high percentage of young population.

We expect new store addition of 70 Nos every year for next the 5-7 years, taking the store count from 376 Nos in FY11E to 631 Nos in FY15E. 

Also, expect revenue per store to grow at 16-17% CAGR (equal to growth in personal care products) from Rs 22 million/store in FY11E to Rs 40 million/store in FY15E. The model would generate operating cashflow of Rs 1.2 billion in FY11E scaling up to Rs 3.6 billion in FY15E, sufficient to fund store expansion and address new growth opportunity in QSR segment.”

“JFL has identified 2nd growth driver - in the form of Dunkin' Donuts, which would cater to all-day snacking segment. 

KEC Int - KEC forays into water business; Wins first order worth Rs 31 crore

Published on Fri, Apr 08, 2011 at 15:47   |  Source : Moneycontrol.com


KEC International Ltd has informed BSE regarding a Press Release dated April 07, 2011 titled "KEC forays into Water business; Wins first order worth Rs. 31 crore."Source : BSE

Buy Biocon; target of Rs 390: IIFL

IIFL is bullish on Biocon and has recommended buy rating on the stock with a target of Rs 390 in its April 8, 2011 research report.

“Biocon (On the daily chart ) has formed a rounding bottom pattern. After a three month consolidation period the stock has now turned bullish. A move above 100-DMA and 200-DMA in yesterday’s session accompanied by higher-than-average volumes suggests an uptrend. Since rounded bottom formation occurs at the end of downtrend, this suggests the stock is ready for an upmove. The daily momentum indicators suggest a positive divergence. We expect the stock to touch Rs 390 in the near term. Traders are advised to buy the stock above Rs 377 with stop loss of Rs 372 for target of Rs 390,” says IIFL research report.

Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management.Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

Sell Welspun Corp; target of Rs 185/180: Aditya Birla Money

Aditya Birla Money is bearish on Welspun Corp and has recommended sell rating on the stock with a target of Rs 185/180 in its March 8, 2011 research report.

"Welspun Corp has been trading mixed holding below the resistance level of Rs 210 over the last one week. The 14-day RSI and Stochastic (14/3/3) are moving sideways near the overbought territory and are exhibiting potential negative divergence. Also the said resistance is formed by the confluence of Fibonacci retracement, 200-day EMA and 200-week EMA. This coupled with negative divergence on daily indicators indicates that prices could see a downside correction in the near-term, however, a break below the support at Rs 201.45 is required to confirm the same and turn the sentiments weak towards Rs 192 and lower subsequently. Until then the sentiment would remain mixed and finds stiff resistance near Rs 210/212 levels on any gains."

"Sell Welspun Corp initially below Rs 201.40 and then on any rise to Rs 204 with a target of Rs 185/180 and a closing stop of Rs 210,” says Aditya Birla Money research report.

Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management.Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

News

Economy News
Food inflation fell to a four-month low of 9.18% for the week ended
March 26 from 9.5% in the previous week and 21.15% a year ago (ET).

The finance ministry has said that it is holding consultations with the RBI
and will approve the draft guidelines for granting new banking licences
within 15 to 20 days (ET).

India has asked Switzerland to expeditiously ratify the amended double
taxation avoidance agreement (DTAA) to facilitate exchange of
information on funds parked in Swiss banks by Indian nationals (ET).

Nifty--- 08042011

The Nifty opened on a positive note but soon started to slip forming lower tops and lower bottoms. On the hourly charts the Nifty has broken down the bearish head-andshoulders pattern and is now targetting 5787 with reversal placed at 5930. The Nifty is finding resistance around 5940 from the trendline drawn from the high of 6335 and lower top of 6181, which now remains a key hurdle going forward. On the daily as well as hourly charts the Nifty has taken off the trendline drawn from the previous two peaks which was placed at the 5620 area, which should now act as the strongest support in any short-term correction.

On the hourly charts, the momentum indicator is in sell mode and is trading below the zero line. The Nifty is trading below its 20-hourly moving average (HMA) and its 40-HMA, ie 5889 and 5871 respectively. The market breadth is negative with 349 advances and 1,036 declines.