Reliance GIC Annual Reports, Balance Sheet and Financials

Reliance General Insurance Balance Sheet (Rs in Thousands)

Reliance General Insurance Profit & Loss Statement (Rs in Thousands)

 Reliance General Insurance Consolidated Cash Flow Statement (Rs in Thousands)

Here is a summary of the Cash Flow Statement for the years 2024 and 2023:

Cash Flows from Operating Activities:

The company generated a strong net cash inflow of ₹2,15,43,506 thousand from operating activities in 2024, up from ₹1,81,46,875 thousand in 2023. This increase was driven by higher direct premiums received, which amounted to ₹12,84,52,475 thousand in 2024, a significant increase from ₹9,91,29,402 thousand in the previous year. Key outflows included direct claims paid of ₹6,85,76,199 thousand and commission/brokerage payments of ₹1,74,43,584 thousand, both of which grew substantially in 2024. Payments to re-insurers and co-insurers fluctuated, but there was also a positive net effect from other operating expenses and advances received. After paying income taxes of ₹13,34,861 thousand, the company remained in a solid cash-generating position from its core insurance activities.

Cash Flows from Investing Activities:

Investing activities saw a net cash outflow of ₹2,25,25,009 thousand in 2024, an increase from the outflow of ₹1,50,98,708 thousand in 2023. The company made substantial investments in securities, spending ₹13,76,00,607 thousand on purchasing investments. However, sales of investments generated ₹10,74,07,457 thousand, mitigating some of the outflow. The company also earned ₹1,17,52,077 thousand in interest, dividends, and rent from its investments, providing additional cash inflows. Despite this, the overall investing activity remained in negative territory due to continued investment in fixed assets and other money market instruments.

Cash Flows from Financing Activities:

Financing activities led to a net cash inflow of ₹22,81,804 thousand in 2024, compared to a negative cash flow of ₹1,66,480 thousand in 2023. The inflows were mainly driven by the issuance of share capital, which raised ₹25,70,580 thousand, offset slightly by dividend and interest payments of ₹2,88,776 thousand. This injection of funds from financing helped improve the overall cash position.

Net Change in Cash and Cash Equivalents:

As a result of these activities, the company reported a net increase in cash and cash equivalents of ₹13,00,301 thousand in 2024, compared to an increase of ₹28,81,690 thousand in 2023. The cash and bank balances at the beginning of the year stood at ₹-16,96,379 thousand, reflecting a negative position due to the temporary overdraft, which improved by the end of the year to ₹-3,96,078 thousand.

Financial Ratios of Reliance General Insurance

Here is a summary of the financial and operational metrics for Reliance General Insurance for the year 2024 and 2023:

Gross Direct Premium to Net Worth Ratio

This ratio measures the company's ability to generate gross direct premiums relative to its net worth. In 2024, the ratio was 3.76, down from 4.02 in 2023, indicating a decrease in the company's premium generation capacity compared to its equity base.

Growth Rate of Net Worth

The growth rate of net worth reflects the increase in the company's equity over the year. In 2024, the net worth grew by 21%, up from 12% in 2023. This indicates a significant improvement in the company's ability to retain earnings and enhance its financial strength, signaling a robust equity base and better capital management in 2024.

Expenses of Management to Gross Direct Premium

This ratio measures the management expenses as a proportion of the gross direct premiums written. It remained consistent at 28% in both 2024 and 2023, indicating that the company managed its operational expenses efficiently relative to the premiums generated.

Expenses of Management to Net Written Premium Ratio

This ratio compares management expenses to the net written premiums (gross premiums minus reinsurance costs). The ratio increased from 45% in 2023 to 48% in 2024, indicating a slight rise in management expenses relative to the net written premium.

Net Incurred Claims to Net Earned Premium

This ratio measures the proportion of claims incurred relative to the net premiums earned. It increased from 77% in 2023 to 81% in 2024, showing that a higher proportion of the company's premium income was used to pay out claims.

Technical Reserves to Net Premium Ratio

The technical reserves to net premium ratio reflects the adequacy of reserves set aside to cover future liabilities compared to the net premiums earned. The ratio remained stable at 2.14 in 2024 and 2.13 in 2023, indicating that the company maintained a consistent level of reserves relative to its net premiums.

Operating Profit Ratio

This ratio measures operating profit as a percentage of net earned premium. The ratio dropped sharply from 12% in 2023 to 3% in 2024, reflecting a decline in profitability from core operations.

Liquid Assets to Liabilities Ratio

This ratio indicates the company's ability to meet its short-term liabilities with liquid assets. It improved from 0.16 times in 2023 to 0.21 times in 2024, showing a better liquidity position. While still relatively low, the increase suggests the company strengthened its liquidity buffer, improving its ability to cover immediate obligations.

Net Earnings Ratio

The net earnings ratio measures net profits as a percentage of total revenue. It slightly declined from 4.30% in 2023 to 4.10% in 2024, reflecting marginally lower profitability. Despite this decline, the ratio indicates that the company still maintained a healthy level of profitability relative to its revenue.

Return on Net Worth Ratio

This ratio indicates how effectively the company is using its net worth to generate profits. It fell from 11% in 2023 to 9% in 2024, suggesting a decrease in the company’s ability to generate returns for shareholders.

Gross and Net NPA Ratios

These ratios measure the proportion of non-performing assets (NPAs) relative to total loans. Both the Gross NPA and Net NPA ratios were 0.46% and 0.26% respectively in 2023 but dropped to zero in 2024, indicating an improvement in asset quality.