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On Sunday, JPMorgan analyst MW Kim upgraded Thai Life Insurance (NSE:LIFI) (TLI:TB) stock rating from Neutral to Overweight and raised the price target to THB15.00 from THB10.50. Kim highlighted the company’s year-to-date performance, which has remained steady while the SET Index has fallen by 15%.
The upgrade follows Thai Life Insurance’s consistent performance and the anticipation of three key catalysts post the first quarter of 2025 reporting under the new IFRS-17/9 accounting standards. JPMorgan projects potential upward revisions to consensus earnings per share (EPS), with forecasts for the fiscal year 2025 net profit at Bt 12.2 billion. These revisions could lead to over 10% increase in EPS as estimates adjust to the new accounting framework.
Kim also cited the expected reduction in earnings and balance sheet volatility due to interest rate movements. This stability is anticipated because valuation changes in assets and liabilities could be partially offset within the balance sheet under the new accounting standards.
Another factor contributing to the positive outlook is the projected average annual growth of 3% in the Contractual Service Margin (CSM) balance over the next three years, which is expected to support steady insurance profit growth. Thai Life Insurance’s IFRS-17 disclosures are based on reasonable actuarial assumptions, which suggests a smaller risk of adverse reserve movements. This, according to JPMorgan, could lead to an enhanced risk-reward profile for the insurer, with better earnings and dividend visibility. The firm forecasts a dividend yield of over 4% for the fiscal year 2025.
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