Chola MS reaps wholesale returns with retail thrust

GopalarathnamChennai: After a fall in its growth rate in FY06 to 31.7 per cent from 74.3 per cent the previous year, private non-life insurer Cholamandalam MS General Insurance Company Limited (Chola MS), recovered a little last fiscal.

It logged 41 per cent growth with a gross premium income of Rs314.6 crore. The profit after tax stood at Rs12.4 crore and the underwriting profit was Rs7.5 crore after factoring net claims outgo of Rs70.8 million.

However, the first quarter performance of Chola MS, located literally on the Coramandel coast in Chennai, is certainly creating ripples in the industry if not waves. The company accelerated its premium earnings to Rs147.93 crore up from Rs79.80 crore made during the previous year''s corresponding period. Chola MS wiped out all its accumulated losses.

The company, a 74:26 joint venture between $2-billion turnover Murugappa Group and Mitsui Sumitomo Insurance group, Japan, literally located along the Coromandel coast is making waves in the industry with its resurgence.

When one looks at the figures in the light the rumours that floated in the market in the recent past-like promoters exiting the business, and also the drastic cut in the fire and engineering insurance rates early this year, Chola MS'' performance is quite impressive.

For the current year Chola MS has fixed a target of Rs600 crore premium income, nearly 91 per cent over last year''s achievement. And by 2010 the goal it hopes to become a Rs1,000-crore premium outfit.

Given this ambitious targets, M Anandan, managing director and his lieutenant S S Gopalarathnam, president, operations, are hard at work to overtake other private sector insurers like another Chennai-based insurer, Royal Sundaram Alliance Company Limited, that belongs to the TVS group.