Mitsui Sumitomo keen to hike stake in Chola MS General Insurance to 49%: report

Japan's Mitsui Sumitomo Insurance Group is looking to raise its stake in Cholamandalam MS General Insurance Company, a general insurance joint venture with Murugappa Group, to the 49 per cent ceiling from its present level of 26 per cent, reports quoting sources familiar with the matter said.

Cholamandalam MS General Insurance Company Ltd is a joint venture of the Murugappa Group and Mitsui Sumitomo Insurance Company Ltd (MSI), Japan's second largest insurance group.

MSI, which earlier in the day announced the acquisition of 100-per cent stake in UK's Amlin plc (See: Mitsui Sumitomo snaps up UK insurer Amlin for $5.3 bn), is looking for growth outside as growth within Japan stagnates.

The company, like several other global insurers such as AXA, Tokio Marine and Bupa, is also looking to India for growth in India. "Mitsui is in advanced stages of discussion to increase stake in Cholamandalam GeneralInsurance," a report in The Economic Times quoted a senior executive of Cholamandalam as saying.

Cholamandalam MS General Insurance Company aims to achieve a gross premium of Rs2,500 crore for the financial year 2015-16, the company stated in release.

The company had collected gross written premium of Rs1,890 crore in 2014-15, marginally up from Rs1,855 crore in the previous year.

Profit after tax of the company almost doubled to Rs137 crore during the last financial year, from Rs70 crore in 2013-14. The company operates through nearly 105 branches and over 9,000 agents across the country.

According to the company's annual report, its net worth was Rs719 crore as of 31 March 2015. It had fixed assets of Rs61.7 crore and investment portfolio of Rs3,164 crore.

General insurance industry in India has grown about 9.3 per cent over the previous year, after being hit by economic slowdown over the past couple of years hit by slow auto sales that badly affected the motor insurance business.