Maybank Investment Bank Bhd (Maybank IB) has maintained a BUY call on MNRB Holdings Bhd after the company's financial results in the second quarter of financial year 2025 (2QFY25) were within expectations.
In 2QFY25, the company posted a 123% year-on-year (YoY) increase in its net profit to RM92.7 million despite a 60% quarter-on-quarter decline. This strong performance contributed to a 66% growth in net profit for the first half of FY25, totalling RM184.9 million, which accounts for 49% of the full-year forecast.
The significant increase in MNRB's 2Q net profit was primarily driven by robust contributions from the reinsurance division, which saw its pretax profit surge by 150% YoY and accounted for 64% of the group's total pretax profit.
However, this strong performance was partially offset by unrealised foreign exchange losses on foreign assets.
As MNRB navigates the complexities of the insurance sector, the emphasis remains on enhancing operational efficiency and maximising the potential of its reinsurance division, which has proven to be a critical earnings driver.
With strong financial performance backing its strategy, MNRB is well-positioned to leverage opportunities in the market, continuing to build on its current momentum in the upcoming quarters.
On that note, Maybank IB has set a target price of RM2.70 based on a long-term forward rolling price-to-earnings ratio mean of 5.5 times for its calendar year of 2025 estimates.
