Broker: Maybank Investment Bank Berhad
Date of Report: August 26, 2025

Allianz Malaysia Delivers Strong 2Q25 Results: Outpaces Market, Raises Investor Confidence

Executive Summary: Allianz Malaysia Surges Ahead with Robust 1H25 Performance

Allianz Malaysia Berhad (Allianz Malaysia, ALLZ MK) reported outstanding financial results for the second quarter of 2025, surpassing analyst expectations. Driven by exceptional gains in its general insurance business and steady life insurance growth, Allianz Malaysia continues to solidify its industry leadership. The company maintains its BUY recommendation with a target price of MYR23.05, reflecting confidence in future prospects despite market uncertainties, particularly regarding medical premium caps.

2Q25 Financial Highlights: Above Expectations, Across the Board

Allianz Malaysia’s 1H25 net profit soared to MYR427 million, marking a 20% year-on-year increase and achieving 53% of the full-year forecast. This performance was propelled by stronger-than-anticipated contributions from Allianz General, with notable gains in both revenue and market share.

Allianz General: Outperforming the Industry with Market Share Gains

Allianz General continues to outperform the Malaysian insurance industry, with GWP (Gross Written Premium) growth of 11.3% YoY, compared to the industry’s 4% growth rate. This was largely driven by robust motor insurance premiums, which alone surged by 11.5% YoY. As a result, Allianz General’s market share increased from 14.8% at end-December 2024 to 15.1% at end-June 2025, cementing its position as the industry leader.
Key operational improvements include:
Combined ratio improved to 86.9% in 1H25 from 88.4% in 1H24.
Claims ratio dropped to 62.7% from 64.1% a year earlier, reflecting improved risk management and underwriting quality.

Allianz Life: Steady Growth and Expanding Market Presence

Allianz Life’s performance in 1H25 further underscores the group’s balanced growth:
Bancassurance GWP grew 8.1% YoY.
Employee benefits GWP expanded by 12.9% YoY.
Annualised New Premiums (ANP) rose marginally by 0.6% but outperformed an industry-wide contraction of 7.4%.
Market share climbed to 12.1% from 10.4% in 2024.
Additionally, the Contractual Service Margin (CSM) for Allianz Life increased 3% year-to-date, reaching MYR3.65 billion by end-June 2025. New business value in 1H25 reached MYR290.6 million, surpassing the CSM release of MYR245.2 million—a positive indicator for future profitability.

Valuation: Sum-of-the-Parts (SOTP) Approach Remains Unchanged

Maybank Investment Bank Berhad maintains its SOTP valuation of MYR25.60 per share for Allianz Malaysia, applying a prudent 10% discount to account for uncertainties, such as medical premium caps. This results in a target price of MYR23.05.

Financial Performance and Key Metrics: 2023-2027

The following table summarizes Allianz Malaysia’s financial trajectory and key ratios for the last two years and projections through 2027, highlighting consistent growth and robust returns.

Balance Sheet Strength and Capital Position

Allianz Malaysia maintains a robust balance sheet, supporting its growth trajectory and risk absorption capability. Total assets grew from MYR25.9 billion in FY23 to a projected MYR33.8 billion in FY27, with shareholders’ funds similarly strengthening over the period.
Key highlights include:
Consistent growth in investment assets, from MYR23.1 billion in FY23 to a projected MYR30.0 billion in FY27.
Increasing total liabilities, in line with business expansion and insurance contract growth.
Strong capital base, with book value per share rising from MYR14.85 (FY23) to MYR15.42 (FY27).

Dividend Policy and Shareholder Returns

Allianz Malaysia offers attractive dividends, with a yield expected to remain at 5.0% through FY27. The company’s dividend per share (DPS) is forecast at MYR0.90 per year from FY24 onward, ensuring steady returns for investors.

Risks and Market Outlook

While Allianz Malaysia’s prospects remain positive, investors should be mindful of the following risks:
The life insurance segment is closely tied to consumer sentiment and household wealth growth.
High claims, particularly from catastrophic events, could pressure profitability.
The general insurance segment is exposed to fluctuations in demand for vehicles and property, especially during economic downturns.
Regulatory changes, such as the ‘de-tariffication’ of fire and motor tariffs, may spark rate competition, impacting margins.

Historical Ratings and Share Price Performance

Allianz Malaysia has received consistent BUY and HOLD recommendations in recent years, reflecting its resilient performance and the market’s confidence in its leadership position.

Conclusion: Allianz Malaysia Remains a Top Pick in the Malaysian Insurance Sector

Allianz Malaysia’s strong financial results for 2Q25 and the first half of the year reinforce its status as an industry leader. The company’s diversified growth across general and life insurance, improving operational metrics, and robust capital position support the continued BUY recommendation. With a target price of MYR23.05, Allianz Malaysia offers both stability and growth potential for investors seeking exposure to Malaysia’s dynamic insurance sector.