KUALA LUMPUR, Feb 18 — Syarikat Takaful Malaysia Bhd shares rose 46 sen or 4.5 per cent following strong 2013 financial year results announced yesterday. The stock stood at RM10.68 as at 12:30 pm after opening at RM10.32, with 1.13 million shares transacted.

Takaful Malaysia’s pre-tax profit for the 2013 financial year surged 42.9 per cent to RM179.3 million from RM125.45 million in the same period in 2012. Revenue grew to RM1.71 billion from RM1.6 billion in 2012.

RHB Research said Takaful Malaysia’s FY13 earnings beat the estimate of the research house and that of the consensus owing to better wakalah (premium payment) income as well as loss ratio.

“The RM139 million FY13 profit beat ours and street estimates by 110 per cent and 115 per cent respectively,” the research house said in a note today.

RHB Research said the strong performance of the Islamic insurance service provider was due to higher fee income, improved claims and expense ratios as operations in Malaysia posted 9 per cent revenue growth and 15 per cent rise in revenue from new businesses.

“These outweighed the weak 6 per cent revenue growth (behind the management’s double-digit growth target) as its Indonesian operations faced headwinds,” it said.

The research firm said while it had expected a significant moderation in contributions growth owing to a challenging year and tighter Bank Negara Malaysia regulations on personal financing and household debt, the actual effect was worse than the earlier projection of 15 per cent topline growth. “Nevertheless, Takaful Malaysia’s bottomline performance was spectacular, given the management’s prudent policies,” it added.

RHB Research projected Takaful Malaysia’s revenue to grow 9 per cent this year as the general takaful segment was expected to fare better on the back of an improved economic outlook and the segment’s unique cash-back proposition.

It said the company had been fulfilling its duty by paying a record high cash back of RM30 million to its general takaful customers who did not make any claims during the coverage period.

“We see this giving Takaful a competitive edge as such a move bodes well for consumers amid the spiralling cost of living,” it said.

RHB Research has maintained a “Buy“ call on Takaful Malaysia but raised upwards its target price to RM13.10 from RM12 previously. — Bernama