Allianz - Revisit

I blog about Allianz 2 years ago, at that time it was traded below RM4.00, I keep highlighting Allianz after that but it share price only appreciated recently only. I vet through some of the recent analyst's reports on it, amazing to notice that they (so called analyst) still assume that Allianz is a smaller company as compare to LPI and Manulife. What a big mistake they made, indeed Allianz is the biggest general insurer in Malaysia in term of underwriting premium, and now also in term of net profit.

Although LPI is traded at around market capital around 3.0 billion and making around 40 million last financial quarter, by annualize it going to make around 160 million for FY12.

Allianz is making 57million for the last financial quarter, look like it going to make more that 200 million for FY12. And it only traded at market capital around 2.4 billion.

Investor priced LPI using dividend yield model, that is why it fetch a very high PE valuation.

Allianz is set to grow after rationalizing of business previously acquired from CIMB, and put in place better underwriting discipline. It is a matter of time Allianz will start to pay good dividend, then it will be traded at market capital higher that LPI. The logic is simple, end of the day it is the net profit that does matter. Although a friend of mine keep telling me that net asset is a more accurate measurement for insurer, but I choose to follow the net profit method. You can tell me anything, but to me net profit or better still cash flow

Previously I also mentioned that it is a matter time market capital of Hartalega will be higher that LPI, QL ........a bunch of them. Seem I am correct at the moment. The issue is still haunting Allianz is the tight liquidity.

As I had mentioned a couple of time that patience is the only advantage a retail investor possess.

CIMB - Revisit

Over the years, CIMB had transformed from an investment bank to universal bank, then from universal bank to a regional bank. It is a of the good foresighted company in Malaysia. In term of management competence I rank it the best in Bursa Malaysia. Its shareholders have enjoyed good profit for years. It is an ordinary business that well managed. Its success is partly due to political link, and currently overshadow by this link.

As general election is around the corner, investors priced in the potential outcome. After read through an interview appeared on The Star on 4 August 2012, I must say I am impressed by it. It is the most ambitious bank in the Asean region, not even Singapore banks are that ambitious. As guided by Nazir sometimes ago, its Indonesia operation had became the largest profit contributor, over times its oversea profit will outpace local profit contribution.

Its planning to list in Thailand or Indonesia will enhance it valuation in my view. Local investors still not priced in a valuation of Regional Bank.

Questions in my mind, 1st, do investor priced in the political risk? 2nd, do investor priced in regional bank valuation? The worst scenario of buying now or the potential price adjustment of buying after general election?  The bank still will be well managed or ambitious if Nazir is not around?