Sharekhan's research report on HDFC Life Insurance Company
The new surrender regulations would impact VNB margins by ~100 bps, which the company may partially offset by a combination of better pricing, change in payout structures and better product mix. Company expects an uptick in non-par, term protection business from here on and share of ULIP would moderate. The annuity segment continues to see pricing pressure. Proposal for exemption of GST on pure term protection plans has been deferred by the government and is likely to be taken up in November meet. Stock trades at 2.7x/ 2.3x/ 2.0x its FY2025E/ FY2026E/ FY2027E EVPS.
Outlook
We maintain a Buy on HDFC Life with a revised PT of Rs.870. The company is confident of growing retail APE higher than industry APE and doubling VNB every four years.
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