Co-Operative Insurance to go public
- Merchant Bank to manage IPO
Co-Operative Insurance recently announced their plans to go for its first Initial Public Offering (IPO) in 2021. The IPO is to be managed by the Merchant Bank of Sri Lanka.
The company was able to grow by 5% in Covid-19 pandemic, while posting a profit of Rs. 695 million for the fiscal year 2020.
“Co-Operative Insurance has yet again delivered a strong year of financial performance the past year with revenue (Gross Written Premium) of Rs. 5.2 billion. The company’s steady, undeterred performance continued to demonstrate stability during a period that was characterised by numerous restrictions forced into play by the global pandemic. Our robust cost management initiatives, proactive drive to innovate, commitment to process re-engineering efforts backed by digital technologies, and most importantly the strength of our passionate and deeply dedicated team have helped Co-Operative Insurance to move from strength to strength. As a truly Sri Lankan company, these traits have helped prepare ourselves for the upcoming IPO that will enable us to further offer unparalleled standards of insurance to people from different backgrounds across Sri Lanka,” remarked Co-Operative Insurance Managing Director Mr. Wasantha Ranasinghe.
During the period in review, Co-Operative Insurance’s market share has increased to 4.06%, in comparison to 3.89% as in 2019, according to the ircsl.gov.lk, 2020. Compared to the industry GWP growth, which was (2.24%) during the past year, the company recorded GWP growth of 2%. The company reported a five-year average annual growth rate of 21% of GWP, while the industry’s five-year GWP average annual growth was at 8.95%. Co-Operative Insurance also noted that its contribution to increasing insurance penetration in the country has increased during the period in review, with 916,682 policies issued by CICL.
Profit after tax (PAT) for 2020 rose to Rs. 695 million, an increase of 155% YoY. Profit before tax (PBT) grew by 120% compared to previous year to stand at Rs. 940 million.
Established in 1999 Co-Operative Insurance operates the third largest branch network amongst all local insurance companies today. According to general insurance policy, there was a need to grow the company’s capital to Rs. 1 billion in 2015, an undertaking Co-Operative Insurance led with the creation of its subsidiaries Co-Operative Insurance Company and Co-op Life Insurance – a historic benchmark within the organisation. Of this, 99.99% of the total investment of Rs. 1 billion were investments from co-operative societies across the country. Together, they provide diversified general and life insurance solutions to customers, SMEs, cooperative society members, and corporations.
Co-Operative Insurance was also able to grow its share capital of Rs. 1 billion in 2015 to Rs. 1.6 billion, and its assets to Rs. 11 billion. The company posted 44% growth in 2016 by competing side by side with multinational companies around the world.
The company was also awarded a Fitch Rating of BBB+ Positive outlook over the past few years. The strategic expertise of its management and its proven financial stability has enabled the company to continue to deliver dividends higher than the general Weighted Average Treasury Bill Rate.