Buy SBI Life Insurance; target of Rs 2140: Motilal Oswal

Motilal Oswal is bullish on SBI Life Insurance has recommended buy rating on the stock with a target price of Rs 2140 in its research report dated July 24, 2025.

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July 28, 2025 / 14:19 IST

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26 Aug, 2025 12:21

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Motilal Oswal's research report on SBI Life Insurance

SBI Life Insurance (SBILIFE) reported 9% YoY growth in new business APE to INR39.7b (in line). VNB margin for the quarter stood at 27.4% vs our estimate of 28.5% (26.8% in 1QFY25). Absolute VNB grew 12% YoY to INR10.9b (in-line), driven by the product mix shift toward non-linked products. Shareholder PAT grew 14% YoY to INR5.9b (in-line) in 1QFY26. The company reaffirmed its full-year guidance of mid-teen APE growth, supported by new non-par and protection product launches. Apart from the focus on product mix shift toward non-linked products, higher sales of products with larger sum assured and improved rider attachment are expected to drive VNB margin expansion to 26-28% for FY26, according to management. We expect SBILIFE to clock a CAGR of 16%/19% in APE/VNB over FY25-27, while RoEV is likely to remain at ~19% over FY27. We maintain our estimates and reiterate our BUY rating on the stock with a TP of INR2,140 (premised on 2.2x FY27E EV).

Outlook

We expect SBILIFE to clock a CAGR of 16%/19% in APE/VNB over FY25-27, while RoEV is likely to remain at ~19% over FY27. We maintain our estimates and reiterate our BUY rating on the stock with a TP of INR2,140 (premised on 2.2x FY27E EV).

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