2025-05-15-Jefferies-澳大利亚保险集团有限公司（IAG）_与西澳RAC结盟-稳步前行_10页_380kb

Equity Research Summary

• Company: Insurance Australia Group Ltd (IAG).
• Recommendation: Buy Rating, target price AUD9.60, +9% from prior close.
• Key Events: Proposed acquisition of all RAC Insurance (RACI) business for $400m deal completion payment and $950m 20-year distribution/brand licensing agreement. Deal expected first-half 2026, subject to ACCC approval by May 22, 2025.
• Financial Highlights:
  • Insurance profit guidance increased to AUD1.65B-AUD1.85B (originally AUD1.4B-AUD1.6B), driven by better-than-budget AUD250M perils claims reduction in FY25 amid natural events.
  • EPS forecast revised +1% to +4% for FY25 due to claims and premium growth.
  • GWP expected to grow, with combined RACQ-RAC increasing insurance profit ~AUD300M.

Valuation and Targets:

• Total acquisition price AUD1.35B equates to 16.4x FY24 NPAT, 9.5x FY25 earnings.
• Upside scenarios assume lower claims, higher investment returns; downside includes reinsurance costs and climate risks.
• Price target AUD9.60 vs prior 9.10; multiples blend DCF and P/BV.

Risks and Catalysts:

• Regulatory risks; climate change poses threat to claims.
• Positive catalysts: Reinsurance cost reductions, continued strong perils performance, NZ market growth.

Other: Strong trading update, improved ROE target to 15%. Benefits include EPS accretion, internal funding, synergies ~AUD100M annually.