AXA likely to push efficiencies & global streamlining in next strategy

Expect European insurance group  AXA to build its next major mid-term corporate strategy increasingly around the side of efficiencies, with a focus on AI, new technologies and unifying the group, equity analysts said following an investor roundtable.

AXA is up for a strategy refresh at the beginning of 2024 and the table was set for investors to largely expect an extension of current priorities for improved per share earnings growth and slickened cash remittances towards shareholder remuneration.

But the market might find “different levers driving it,” analysts at Deutsche Bank said of their early take. DB expects “clearly a lot more to be done from an efficiency perspective” plus work unifying best practices throughout the group. Efficiencies will likely show a focus on implementation of technology and AI, amongst others.

The French home market was said to be “clearly in very good and improving shape” for the group with continuing margin improvement. That trend can be furthered via growth into the lower end of the SME space and improved leveraging of data towards better risk selection in health.

The Swiss operations were likewise billed as “clearly also in very good shape” and “one of the best assets of the group.” Margins benefit from the Swiss market’s “oligopolistic nature” plus “passive consumer behaviour” with room left for AXA to grow in commercial P&C, where only AXA and Zurich have the scale to move.

Swiss health also looks like a “quite significant” opportunity, albeit still infant for AXA which boasts annual revenues growing by c. EUR 30-40 million annual on 5-10% underwriting margins.

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