Motilal Oswal's research report on ICICI Prudential Life Insurance
ICICI Prudential Life Insurance (IPRU) reported a 3.9% YoY decline in APE (6% beat) in 1QFY24. While savings and annuity segments saw a decline of 6% and 7.1% YoY, respectively, the protection segment registered a growth of 4.2% YoY. VNB declined 7% YoY to INR4.4b (in line), while VNB margin declined 200bp QoQ to 30% in 1QFY24. Lower margins were led by a change in product mix, wherein the share of non-par savings shifted to par and ULIP products. This was partially offset by strong growth in the protection segment. We estimate IPRU to deliver a 14% CAGR in VNB over FY23-25. This will be driven by a combination of premium growth and steady margins, thereby enabling an operating RoEV of ~18% over FY23-25E.
Outlook
We reiterate our BUY rating with a TP of INR670 (premised on 1.9x Mar’25E EV).
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