Improved business outlook to drive gains for ICICI Lombard

ICICI Lombard (ICICIGI) reported 12 per cent year-on-year (Yo-Y) net earned premium (NEP) growth in Q2FY26.

- DEVANGSHU DATTA

Net profit jumped 18 per cent Yo-Y, driven by improved loss ratio and realisation of capital gains (%2,360 crore) on the investment book.

But ICICI Lombard lost market share across several segments and lags industry growth for H1, despite a pick up in September.

The company continues to dominate in motor and commercial lines, and is building capability in retail health. It remains a leader in terms of profitability.

It has seen a more limited impact of input tax credit (ITC) losses and there are tailwinds from higher new vehicle sales and goods and services tax (GST) exemption for healthcare.

This makes healthcare more affordable and may expand coverage.

The company intends to pass on the full GST benefits.

The reported net profit of ₹820 crore in Q2FY26, up 18 per cent Yo-Y and for H1FY26, net profit grew 23 per cent to ₹1,570 crore. Mid-teen earnings growth is possible, going forward, with return on equity (RoE) of around 17.5 per cent with guidance for medium-term RoE of 18-20 percent.