In the wake of the budget, the government has issued a Retirement Income Covenant Position paper setting out a range of details in relation to Comprehensive Income products for Retirement (CIPR) and allowing a short period for feedback.
The upshot is annuities are likely to play a part and the broker calculates that, were annuity flows to grow by 10-30% and Challenger captures 25-50% of the growth, the company’s annuity book could experience 60-100% growth from lifetime annuity sales alone.
Outperform and $13.20 target retained.
Sector: Diversified Financials.
Target price is $13.20.Current Price is $12.35. Difference: $0.85 – (brackets indicate current price is over target). If CGF meets the Credit Suisse target it will return approximately 6% (excluding dividends, fees and charges – negative figures indicate an expected loss).