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The New India Assurance Company IPO: Avoid this issue -
The New India Assurance Company IPO: Avoid this issue
Rudra Shares and Stock Brokers | Published: 02 Nov, 2017  | Source :


NIA is the largest general insurance company in India in terms of net worth, domestic gross direct premium, PAT and number of branches as of March 31, 2017. It has been in operation for almost a century . The company has supported various GoI and State government social welfare initiatives, including the Pradhan Mantri Fasal Bima Yojana, the Unified Farmer‘s Package Insurance, as well as various State government health insurance schemes.

Despite being a market leader, the financial performance of the company is not encouraging, there is declining profitability, & lower return on equity. company is still dependent on direct sales channel for 60% of the premium collected and has a high dependency on the state of Maharashtra. On the upper price band of RS 800 with EPS of Rs 10.4 for FY17, its P/E works out at 76.9x, which looks quite expensive. We recommend to “AVOID” the IPO .

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Disclaimer: The author has taken due care and caution to compile and analyse the data. The opinions expressed above are only the views of the author, and not a recommendation to buy or sell. Neither the author nor accept any liability whatsoever arising from the use of any of the above contents.