16 Apr 2024 , 12:57 PM
Result date: April 18, 2024
Recommendation: Add
Target price: ₹720
Analysts at IIFL Securities believe HDFC Life Insurance Company (HDFC Life) could witness modest growth in annualized premium equivalent (APE) during the quarter, as compared to the year-ago quarter. This softness growth in APE comes on a tough base, driven by a strong performance in the year-ago quarter, largely due to the pent up selling of non-par savings products in March 2023 ahead of tax-related changes w.e.f. April 1, 2023. Renewal premium though could grow at a robust pace of 18.5% over the year-ago quarter.
Higher share of non-par savings products in the base quarter coupled with increased traction in ULIPs during the quarter under review could result in margins declining by 170 basis points.
Important management insights to watch out for:
₹ Billion | March 2024 estimates | YoY change |
New business premium | 91.1 | (12.2)% |
Renewal premium | 109.7 | 18.5% |
Total APE | 48.1 | (6.9)% |
VNB | 13.2 | (12.4)% |
VNB Margin (%) | 27.6% | (170) bps |
Source: IIFL Research
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