Shares of Niva Bupa rally after strong Q4 show

On NSE the scrip rose 6.57 per cent to end the day at ₹86.35 apiece.
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Shares of standalone health insurer Niva Bupa Health Insurance ended Thursday at ₹ 87.38 apiece on BSE, which was up 7.78 per cent from the Wednesday close, after the insurer reported over 30 per cent year-on-year rise in its net profit for the fourth quarter last fiscal.

On NSE the scrip rose 6.57 per cent to end the day at ₹86.35 apiece.

Niva Bupa on Wednesday reported a 31.21 per cent year-on-year jump in its net profit to ₹206.08 crore, buoyed by an 18.14 per cent y-o-y increase in its gross premiums written during the period.

The insurer’s net profit stood at ₹157.06 crore for Q4FY24. For Q4FY25, gross premiums written rose to ₹2,078.65 crore from ₹1759.44 crore for Q4FY24.

On BSE, the scrip opened at ₹86.5 against Wednesday’s close of ₹81.07 apiece. Later, it climbed as much as to ₹93.33 apiece before settling at ₹87.38. The shares opened at ₹87.03 on NSE and touched the day’s high of ₹92.90 a piece.

“We believe Niva is well-positioned to harness growth opportunities with a strategic global partner, a growing customer base, and innovative product offerings. The diversified channel mix will ensure improved scalability as the company moves toward geographic expansion. Measures taken to mitigate claim inflation will continue to aid loss ratios, while operational efficiency will lead to an improved expense ratio going forward,” Motilal Oswal Financial Services said in its note on the quarterly results of Niva Bupa Health Insurance.

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“Backed by a strong performance in 4QFY25, we have upgraded our estimates under IGAAP, mainly on expense ratio and slightly higher growth,” Motilal Oswal added.

During the fourth quarter last fiscal expenses of management (EoM) ratio stood at 36.33 per cent as against 38.67 per cent in Q4FY24.

During the post-earnings conference call, the company management said it launched a new product in 4QFY25 for the middle-class and lower-middle-class segment, which is one of the largest unserved populations. The claim inflation of 5 per cent was in line with the 5-7 per cent trend. This was supported by ongoing discussions with the provider network to ensure quality treatment and specific negotiation agreements based on data analytics. Billing review, case management, and other measures had also been deployed to ensure fair billing practices.