SBI Life Q3 FY25 results preview: APE seen up 6.5%, VNB margin likely to contract

SBI Life's Q3 net profit is expected to range between Rs 400-500 crore.

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26 Aug, 2025 12:21

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SBI Life Insurance is slated to announce its Q3 FY25 financial results on January 17, with analysts projecting modest growth in APE and VNB, driven by stable new business premium growth and a higher share of ULIPs in the product mix. However, profitability metrics are expected to be under pressure due to the impact of new surrender regulations and the continued sluggish performance of the SBI channel.

According to a Moneycontrol poll of brokerages, SBI Life’s Q3 FY25 APE is expected to grow 6.5 percent on-year to Rs 6,530 crore, supported by strong performance in the agency channel, which has seen robust 25-30 percent growth. VNB is likely to grow a modest 3.3 percent on-year to Rs 1,681 crore, but VNB margin is estimated to contract by 90 basis points from a year ago to 26.5 percent, owing to a higher share of ULIPs and adjustments related to new surrender regulations. Net profit for the quarter is expected to range between Rs 400-500 crore.

SBI Life Q3 FY25 Results Estimates

Among the brokerages polled, Motilal Oswal rolled out the most bullish estimate, projecting a 6 percent on-year growth in VNB, while Emkay Research remained the most bearish, forecasting a 2 percent on-year decline in VNB, reeling under the challenges posed by regulatory changes and product mix shifts.

What factors are driving the earnings?

APE Growth: Analysts expect stable APE growth, supported by a strong agency channel performance, which has witnessed growth of 25-30 percent. However, sluggish growth in the SBI channel remains a concern. SBI Life’s growth will continue to be affected by SBI channel’s slowness, but this is being partly offset by a strong agency channel performance, said Emkay Research.

VNB and Margins: The VNB margin is projected to see a marginal contraction, with estimates ranging from a decline of 40 to 90 basis points sequentially. The margin contraction is influenced by the impact of new surrender regulations and a higher share of ULIPs in the product mix, said Kotak Securities.

Also read | HDFC Life sees QoQ margin expansion in Q3 led by improved product margins, persistency

Product Mix: The company’s relatively lower dependence on non-linked products has provided some resilience. Given its lower dependency on non-linked products, SBI Life should see better VNB margin performance compared to peers, said Emkay Research.

What to look out for in the quarterly show?

VNB Margin Trends: Commentary on the impact of surrender regulations and outlook for margin stability.

Product Mix Shifts: Updates on the share of ULIPs, non-par, and other product segments.

SBI Channel Growth: Observations on growth from the SBI channel, which accounts for a significant portion of individual new business.

Outlook on Regulatory Impact: Insights into the impact of surrender regulations and broader regulatory developments in the insurance sector.

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.