Earnings up twofold Y-o-Y, tops our estimate: Tawuniya reported net profit before zakat of SAR212mn up 113% Y-o-Y (-25% Q-o-Q) underpinned by premium growth, cost discipline and better investment income. The insurer’s earnings came in above our estimate of SAR195mn.   Key highlights: i) GWP up 140% Q-o-Q and 8% Y-o-Y; ii) stronger investment income Y-o-Y due to absence of impairments; iii) combined ratio improved to 91% vs. 94% in 4Q15.   GWP up 8% Y-o-Y – Medical & Motor likely drivers. A decent set of results. The recovery in GWP (+140% Q-o-Q and +8% Y-o-Y) was encouraging. In 3Q16, seasonality, a challenging macro environment and competition dented Tawuniya’s GWP in the medical segment. We believe that the pick-up in GWP this quarter is likely to have been driven by a recovery in growth of medical premiums and sustained strong growth in motor premiums. We estimate that Tawuniya’s loss ratio was 67%, which is broadly in-line with 4Q15. (Company disclosure, Shabbir Malik, Murad Ansari)   Tawuniya: SAR107.61 as of 18 Jan, Rating: Buy, TP: SAR117.00 per share, MCap: USD2,870mn, TAWUNIYA AB / 8010.SE