IME Life Insurance Company Reports Mixed Financial Performance in Q3 FY 2081/82

IME Life Insurance Company has published its third quarter report for the fiscal year 2081/82, showing a blend of growth and contraction across key financial indicators. While the company has recorded improvements in several performance metrics such as premium collection and profit, notable declines in retained earnings and net worth per share raise concerns about the underlying equity health.

The company maintained its paid-up capital at Rs. 5 billion, with no changes in its share premium reserve of approximately Rs. 523.81 million, indicating stability in its capital base. A significant increase of 18.96% was observed in the catastrophe reserves, which rose to Rs. 229.88 million from Rs. 193.25 million. This move reflects a more conservative approach in response to potential insurance liabilities.

However, retained earnings plunged by a dramatic 63.06%, falling from Rs. 1.15 billion in Q3 2080/81 to Rs. 425.61 million in Q3 2081/82. Similarly, other equity components shrank by 14.03%, suggesting either increased dividend payout or losses booked elsewhere in the company’s operations. This erosion in equity is further reflected in the company’s net worth per share, which dropped by 10.33% to Rs. 132.67 from Rs. 147.95.

On the brighter side, the life insurance fund grew by 26.69%, reaching Rs. 12.56 billion, showcasing steady growth in long-term policy liabilities and trust in the company’s insurance products. Correspondingly, investments rose by 9.70% to Rs. 16.69 billion, indicating strategic allocation of premiums and reserves toward income-generating assets.

In terms of revenue, net premiums collected rose by 15.65%, totaling Rs. 3.60 billion, up from Rs. 3.11 billion a year earlier. Investment and loan-related income grew marginally by 2.74%, reaching Rs. 987.77 million. Net profit also improved by 10.49%, amounting to Rs. 366.33 million. This steady profit growth was supported by controlled commission expenses and an increase in business volume.

On the downside, the company saw a 19.72% rise in net claims payment, totaling Rs. 3.51 billion compared to Rs. 2.93 billion in the previous year, hinting at rising insurance obligations. Despite that, the company’s annualized EPS increased to Rs. 9.77 from Rs. 8.84, showing better profitability per share. The Price-to-Earnings (PE) ratio stands at 47.33, indicating a relatively high valuation compared to earnings, common in growth-oriented insurance firms.

In summary, while IME Life Insurance has demonstrated commendable growth in its core business—reflected by rising premiums, profits, and fund accumulation—it must address the significant decline in retained earnings and shareholder equity. This mixed performance indicates both strong operational momentum and underlying financial caution that investors and stakeholders should closely monitor.