INVX Says Surging Bond Yields Favor Life Insurers, BLA and TLI to Benefit, Recommends OUTPERFORM

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InnovestX Securities (INVX) said rising bond yields in the third quarter to date will benefit life insurance companies through higher investment returns, stronger growth in endowment insurance premiums, and improved CSM and VNB. INVX maintained its OUTPERFORM rating on both BLA and TLI but prefers BLA due to its cheaper valuation and greater potential to benefit from rising bond yields. The 10-year Thai government bond yield rose 36 basis points quarter-to-date to 2.42%, in line with the rise in the 10-year US government bond yield to around 5%. BLA has an endowment insurance product proportion of about 60%, higher than TLI's roughly 45%, and is more sensitive to interest rates. In the first seven months of 2026, TLI's annualized first-year premiums fell 24% year-on-year, while BLA rose 10% year-on-year, compared with industry growth of 6% year-on-year. TLI's claims ratio fell 57 basis points year-on-year to 43.1%, and BLA's fell 563 basis points year-on-year to 50.2%. INVX expects TLI's profit to grow 11% in 2026 and 5% in 2027, while BLA is expected to grow 8% in 2026 and 6% in 2027. It forecasts a 2026 dividend of 0.69 baht per share for TLI, representing a dividend yield of 6.0%, and 1.33 baht per share for BLA, representing a dividend yield of 5.4%.

Impact on stocks 4

Financials▲ · 2 stocks
Thai Life Insurance PCL
TLI
▲ PositiveMonetaryrelevance

Rising bond yields benefit TLI via higher investment returns and endowment growth; INVX maintains OUTPERFORM, though it prefers BLA.

Others▲ · 2 stocks
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