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Revenue
₹20,048 Cr
verification pending
Revenue YoY
—
reported change
EBITDA
Pending
latest reported figure
Source
manual review required
record provenance
Actual signal trajectory
Where this quarter sits.
Quarter read
What the record says.
Chola MS reported Q4 FY26 GDPI of ₹20,048 crore, impacted by the loss of crop insurance business (₹590 crore for the year) and a conscious reduction in two-wheeler premium. The combined ratio deteriorated to 115.2% (112.2% ex-1/N), driven by a 10% rise in motor OD claims ratio and prudent motor TP reserving augmentation. Management highlighted a 7-8% pricing improvement in motor OD over the last 2-3 months, expected to reduce loss ratios over the next 6 months. The company seeks forbearance for IND-AS adoption from April 2027. Key risk: continued absence of motor TP premium revision and rising severity in court awards could further pressure underwriting profitability.
Colored figures show movement against the previous available record.
Guidance to track
- Management reiterated medium-to-long-term ROE target of 15%+, to be achieved through combined ratio improvement and float income management.
- Implemented pricing correction in motor OD over last 2-3 months, expected to reduce loss ratios over next 6 months.
- Company will participate in upcoming crop insurance tender across states, aiming to regain lost business.
Risks flagged
- Absence of motor third-party premium increase for 4-5 years, combined with rising minimum wages and medical inflation, could further increase claims severity.
- Motor OD claims ratio rose ~10% for Chola MS vs 5-7% industry, reflecting competitive intensity and pricing inadequacy.
- Transition to IND-AS from April 2027 will cause a significant drop in combined ratio in the adoption year, though it levels out over time.
- Potential reduction in expense of management (EUM) limits may lower intermediation costs but also reduce premium and float income, impacting ROE.
Key quotes
- We are amongst the top three players in terms of the operating expenses component of the EIN.
- The company has adopted a cautious stance with respect to growing the two-wheeler book particularly new vehicles in the context of absence of motor third party premium increase over the last four years.
- We will endeavor to remain at the 15% plus ROE levels.
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