Buy SBI Life Insurance Company; target of Rs 2140: ICICI Securities

ICICI Securities is bullish on SBI Life Insurance Company has SBI Life Insurance Companyommended buy rating on the stock with a target price of Rs 2140 in its research report dated July 28, 2025.

Broker Research

July 29, 2025 / 15:12 IST

BUY

26 Aug, 2025 12:21

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ICICI Securities's research report on SBI Life Insurance Company

SBI Life has provided a mid-teen growth guidance in volume and maintains a healthy 26–28% VNB margin guidance for FY26. We believe this is a sound growth target, especially when compared to mixed trends of credit, motor and health premium growth among other parameters and when juxtaposed with ~14% overall private APE CAGR between FY19–25. VNB margin guidance remains at 26–28% while the company continues to have a very strong record of positive operating variance/assumption changes. Product mix improvement (launch of non-par product), better productivity (branch and agent) and demand recovery in high-margin segments provide scope for positive margin surprise and could offset the impact of lower volumes on VNB. These arguments vs. its sound track record (APE/VNB/EV CAGR of 15.3%/21.8%/20.5% between FY20-25) and attractive valuation (1.9x FY27E P/EV) keep us constructive on SBI Life.

Outlook

We factor in VNB margin of 27.5% and model 15% APE growth in FY26E/27E (8.6%/9.2% YoY APE growth and 27.8%/27.5% VNB margin in FY25/Q1FY26). We value SBI Life based on 2.2x FY27E EV per share (2x earlier) and arrive at a revised TP of INR 2,140 (INR 1,950 earlier).

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