Stake hike, operational improvement should drive re-rating in ICICI Lombard

Most analysts are positive on the stock with target prices between Rs. 1,250 and Rs. 1,630

The ICICI Lombard stock has shot up due to precedence set by a key clearance given for the HDFC- HDFC Bank merger. After ICICI Lombard General Insurance Company merged with Bharti-Axa in September 2021, the ICICI Bank stake in the insurer had dropped to 48 per cent. Under RBI regulations, the bank was then compelled to reduce its stake to 30 per cent, by September 2024. However, once the HDFC-HDFC Bank merger was announced, the merged entity’s stake in HDFC Life would also have dropped below 50 per cent and the central bank agreed to allow the merged entity (which