Shares of ICICI Prudential Life Insurance Company tumbled over 6 percent to Rs 556.75 following a significant decline in the Value of New Business (VNB). The VNB plummeted over 26 percent on-year to Rs 776 crore in the March quarter.
The drop in the VNB margin to 24.6 percent for FY24, down from 32 percent the previous year, was attributed to a shift in the product mix towards unit-linked business and a higher expense ratio.
VNB, also known as new business profit, is a key metric used to assess the profitability of newly written business contracts.
The company's net profit for the March quarter also took a hit, dropping by 26 percent year-on-year to Rs 173.76 crore due to increased expenses.
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ICICI Prudential's net premium income surged 17 percent to Rs 14,788 crore in Q4FY24, compared to Rs 12,629 crore in Q4FY23. Additionally, the insurer's annual premium equivalent (APE) saw a 9.5 percent year-on-year increase to Rs 3,615 crore.
ICICI Prudential's board approved a final dividend of 60 paise per equity share of face value Rs 10 each to its shareholders.
ICICI Prudential reported a mixed performance in Q4 FY24, where the slight miss in VNB margins was offset by a minor beat in APE, which led to VNB in line with our estimates, Emkay Global said in a research report. The brokerage reiterated its 'buy' rating on the stock with an unchanged target price of Rs 700.
At 12.48am, the stock traded 3.2 percent lower at Rs 575. The stock has gained 30 percent in the past year.
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