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Could Great Eastern Holdings Limited Be A Value Insurer?

coins cash moneyThere are four insurance companies that have their primary listing on the Singapore Stock exchange.

The largest by a country mile, with a market value of over S$10b, is Great Eastern Holdings (SGX: G07). The relative minnow amongst them is SHC Capital Asia (SGX: 5UE) capitalised at S$67 million.

However, it is the two companies’ in between could be the most appealing.

The two companies are United Overseas Insurance (SGX: U13) and Singapore Reinsurance Corporation Limited (SGX: S49). Both United Overseas Insurance and Singapore Reinsurance could offer potential value for investors with little in the way of differentiation between the two.

United Overseas Insurance is a leading local general insurance company in Singapore. The company offers personal insurance products including travel, personal accident and home protection.

Its valuation at 8.9 times earnings is the lowest of all of the insurance companies. It is also below the market average of 14. The dividend yield of 3.7% is not overly generous but still marginally better than the market average which is around 3%.

Trading at 0.9 times the book price, United Overseas Insurance could have the potential to offer value, especially when considered alongside its  growing top-line sales and bottom-line profits.

Singapore Reinsurance Corporation Limited could be equally tempting. Its earnings multiple is slightly higher than that of United Overseas Insurance at 9.5. But this is countered by a more substantial dividend yield of 5.4%.

Boasting similar growth in its sales and profits as well as having cash on its books, Singapore Reinsurance Corporation Limited trades at an inviting 80% of its book value.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Adam Kuo doesn’t own shares in any companies mentioned.