KR Choksey's research report on ICICI Prudential Life Insurance
In Q2FY23, the Gross Written Premium (GWP) grew 36.2% YoY/ 3.8% QoQ at INR 98,956 Mn driven by 26.2% YoY growth in the New Business Premium (NBP). For H1FY23, the GWP stood at INR 1,71,603 Mn, a growth of 4.6% YoY with NBP growing by 13.9% YoY. APE for Q2FY23 stood at INR 19,990 Mn, an increase of 31.5% YoY/ 1.1% QoQ. The VNB for Q2FY23 grew by 31.7% YoY/ 20.5% QoQ to INR 6,208 Mn. The VNB margin for Q2FY23 stood at 31.1%, up from 26.0% for Q2FY22. The solvency ratio as of September 30, 2022, was 200.7%. The Embedded Value as of September 30, 2022, stood at INR 326.48 bn, a growth of 8.1% YoY.
Thus, IPRU is well positioned to capture it considering its improving market share and leadership amongst the private peers. Since our last update, the ICICI Prudential Life Insurance share has corrected by ~1.3%. We assign a 2.3x P/EV on FY24E EVPS of INR 295.8 and a VNB multiple of 24.0x to arrive at a weighted average Target Price of INR 680 per share (unchanged) (50:50 weights on the P/EV and appraisal value methodology); indicating a 32.6% upside from the CMP. Accordingly, we re-iterate our “BUY” rating on the shares of ICICI Prudential Life Insurance Ltd.
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