MNRB Holdings Bhd (-ve)

REINSURANCE and takaful operator MNRB (Fundamental: 0.4/3, Valuation: 2.55/3) saw increased trading activity since posting its 4QFYMar2015 earnings results on May 29. The stock closed 4.3% higher at RM4.10 yesterday. 

Net profit for 4QFY2015 increased 2.9% y-o-y to RM76.9 million, reversing a net loss of RM20.1 million in 3QFY2015. For the full year, revenue was flattish at RM2.4 billion, despite a 0.3% growth in gross premiums. Net profit fell 18.2% to RM127.6 million, hit by losses from the MH17 tragedy in July 2014 and the floods in Kelantan, Terengganu and Pahang in late 2014. 

MNRB, 59%-owned by Permodalan Nasional Bhd, is the country’s sole local reinsurer. For FY2015, its reinsurance portfolio in Malaysia contributed 59% of the total gross premiums, with the balance from overseas portfolio.

The stock is trading at a trailing 12-month P/E of 6.6 times and 0.62 times book. Dividends totalled 16.5 sen in FY2014, giving a net yield of 4.2%.

This article first appeared in The Edge Financial Daily, on June 12, 2015.