Sanlam’s market value has powered through the R200bn mark as the insurance group maintains its fortress position in South Africa while reforms in India’s insurance sector position the Asian country as the company’s growth vector.
The group’s share price has rallied 85% in the past three years, a period marked by inspired acquisitions and a ramp-up of its investment in India.
Driving the process is group CEO Paul Hanratty, who is steadfastly executing the group’s three-pronged strategy to grow its dominance in its home market, expand in the rest of the continent, and build a scalable nonbanking financial institution in India.
The board in 2024 extended Hanratty’s contract to the end of December 2027 as the group, which has a presence in eight of Africa’s 10 biggest economies, focuses on its target of achieving a 20% return on equity by 2030.
Sanlam is revamping its loyalty programme, pulling the different loyalty strands across the group into one offering, which will also be integrated into the app, expected to be launched in the first half of 2026.
One of the priority areas for the group is to grow its already leading market position in South Africa and to expand the solutions it provides to clients and build its relevance among younger and mobile-first consumers.
Growth in India
But it is in India, where the group believes it has a “once in a lifetime opportunity”, that the group is expecting exponential growth.
Having invested billions of rand in Shriram Finance over the past two decades, Sanlam has set its sights on having an unrivalled position in the Indian rural economy, which constitutes about 920-million people.
The relationship between Sanlam and Shriram started in 2004. At the time, the Cape Town-based group was eager to expand its presence outside Africa and the two countries that came out on top were China and India.
Shriram Finance has grown into India’s second-largest retail nonbanking financial company, with a loan book of about R550bn, and a dominant position in the pre-owned commercial vehicle and two-wheeler financing market.
In December, Sanalam announced that Shriram Finance will receive an R72bn capital injection from Japan’s MUFG Bank in return for a 20% stake.
The deal will see MUFG pay $4.4bn via the issue of new Shriram Finance shares, subject to shareholder approval, Indian regulatory clearances and other customary closing conditions.
Valued at $170bn, MUFG is one of the world’s biggest diversified financial institutions, with operations in more than 50 countries. The group is headquartered in Tokyo and is listed on the Tokyo, Nagoya and New York stock exchanges.
A new vector that Sanlam sees is India’s growing wealth and asset management. Sanlam and Shriram have launched a 50:50 joint venture to meet the rising demand for wealth creation solutions. India’s asset management market, now at $660bn, is expected to double by 2030.
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