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Challenger Ltd CGF

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Morningstar’s Analysis

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Currency in AUD
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1-Star Price

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5-Star Price

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Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Diversification Is Challenger’s New Mantra: Some Good, Some Neutral, Mostly Encouraging

Shaun Ler Equity Analyst

Analyst Note

| Shaun Ler |

No-moat Challenger is not the same major bank-dependent annuity seller as in 2018. Immediate priorities are on client diversification, product expansion, and paying up for future growth. In its core annuities business, Challenger noted it will form more sales relationships with institutional clients and sell directly to investors. It intends to leverage the to-be-approved bank acquisition to sell term deposits, and expand its customer cohort. In funds management, the firm will partner with more specialist managers, distribute more products, and sell to a wider audience.  

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Company Profile

Business Description

Challenger’s core business is selling annuity products in the Australian retirement market and, since November 2016, selling Australian dollar-denominated annuities into Japan's large retirement market. The firm’s annuity products provide investors guaranteed regular payments over an agreed term for an up-front lump sum investment and is designed primarily to protect investors from the longevity risk of outliving their savings. Challenger also operates a funds management business, Fidante Partners, which has minority stakes in several boutique global investment managers, and CIP Asset Management, which primarily manages investments supporting its annuities business.

Contact
5 Martin Place, Level 2
Sydney, NSW, 2000, Australia
T +61 299947000
Sector Financial Services
Industry Insurance - Life
Most Recent Earnings
Fiscal Year End Jun 30, 2021
Stock Type
Employees 735

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