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Buy ICICI Prudential Life Insurance Company; target of Rs 471: Prabhudas Lilladher

Prabhudas Lilladher is bullish on ICICI Prudential Life Insurance Company has recommended buy rating on the stock with a target price of Rs 471 in its research report dated January 23, 2019.

January 30, 2019 / 04:22 PM IST
 
 
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Prabhudas Lilladher's research report on ICICI Prudential Life Insurance Company


ICICI Prulife's struggled on business growth with overall APE de-growing by 4.2% YoY on back of slowdown in ULIP mainly towards high ticket size affluent clients. While savings was impacted on this phenomena, protection business grew quite strong at 1x in 9MFY19 (1.5x implied 3QFY19). Management explained volatile scenario in financial markets, moving towards lower ticket size and monthly pay option product has led to decline but monthly numbers have shown pick up in business growth. We believe, growth impact is higher and will take some a few quarters to stabilize especially at the agency channel hence we reduce our APE growth assumptions to 3% YoY and slightly reduce margin on cost strain. Persistency has seen marginal weakness on 13th month but surrenders have to be seen which are stable currently.


Outlook


Retain BUY with revised TP of Rs471 (from Rs507) based on 2.6x (from 2.8x) Sep-20 EV.


For all recommendations report, click here


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