Takaful Malaysia to benefit from expanding market

PETALING JAYA: Syarikat Takaful Malaysia Keluarga Bhd (Takaful Malaysia) is undervalued considering its robust profit-generating potential and increasing presence, MIDF Research says.

STMB has the distinction of being the only 100% syariah-compliant takaful operator on Bursa Malaysia, along with being one of the largest players in the fast-growing local takaful space, the research house said.

“Following a lapse before and during the pandemic, Takaful Malaysia seems to be slowly recapturing its market share,” MIDF Research said in a recent note.

This is coupled with the local takaful space being less saturated than the insurance segment, which gives STMB the advantage of facing less competition than its conventional counterparts, the research house said.

MIDF Research anticipates the trend to persist, especially after Takaful Malaysia entered new partnerships with Bank Muamalat Malaysia Bhd and Bank Pertanian Malaysia Bhd.

It added that Takaful Malaysia’s heavy reliance on bancatakaful has also contributed to a unique family takaful portfolio mix.

MIDF Research initiated its “buy” call on Takaful Malaysia with a target price of RM4.97, pegged to a forecast financial year 2025 price-to-book value ratio of 1.84 times.