KUALA LUMPUR (Oct 24): Shares of MNRB Holdings Bhd (KL:MNRB) surged on Thursday and recorded their best single-day gain in two months, following the reinsurer’s latest quarterly results.

The share price of MNRB climbed as much as 20 sen or 9.48% to RM2.31 in the morning session. At the closing bell, the stock gained 15 sen or 7.11% at RM2.26, marking its strongest performance since Aug 16, 2024, when it recorded a single-day gain of 22 sen, or 10.38%.

At RM2.26, the stock is valued at RM1.65 billion. Trading volume totalled 2.8 million shares, above its 200-day average volume of 1.36 million shares. 

MNRB’s share price has surged by over 85% since the start of the year, fuelled by stronger earnings growth in its reinsurance and general takaful divisions. 

Permodalan Nasional Bhd (PNB) and its unit trust fund, Amanah Saham Bumiputera (managed by AmanahRaya Trustees Bhd), collectively hold a 53.91% stake in MNRB, with PNB owning 12.03% and Amanah Saham Bumiputera controlling 41.88%.

MNRB saw its net profit for the second quarter ended Sept 30, 2024 (2QFY2025) more than double to RM92.74 million, compared to RM41.57 million in the same quarter last year.

The sharp rise was driven by stronger insurance services, largely due to improved claims experience, higher interest rates, favourable foreign exchange movements, and higher share of the result of an associate.

This profit growth occurred despite a slight dip in quarterly revenue, which slipped 0.33% to RM974.34 million from RM977.52 million in 2QFY2023, attributed to a decline in insurance revenue from the reinsurance business.

For the first half of FY2025, MNRB recorded a net profit of RM184.94 million on RM1.9 billion in revenue.

In comparison to the first quarter ended June 30, 2024 (1QFY2025), net profit edged up 0.58% from RM92.2 million, while revenue grew by 3.54% from RM941.05 million.

Maybank Investment Bank (Maybank IB), the only research house covering MNRB, has a ‘buy’ call on the stock with a target price of RM2.70.

In a note dated Aug 18, Maybank IB revised its profit forecast for MNRB, raising it by 92% for FY2025 and 76% for FY2026, amid expectations of sustained earnings momentum.

However, the research house highlighted several risks for MNRB, including thin underwriting margins in the reinsurance business, the potential need for capital injections given the capital-intensive nature of the industry, the possibility of full liberalisation in the reinsurance market, the impact of full detariffication on the general takaful business, and further consolidation within the insurance industry that could intensify competition.

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