Buy ICICI Prudential Life Insurance: target of Rs 720: ICICI Securities

ICICI Securities research report on ICICI Prudential Life Insurance

We remain enthused with IPRU Life’s product and channel diversification strides, which has made the business considerably more robust than before. This is illustrated by the fact that the Rs21.6bn FY22 VNB mix is split between 16% by ULIPs, 43% by protection and 41% by non-linked savings. While volume growth has been volatile, product/distribution levers are available for VNB (volume and margin) growth, which should ensure >15% RoEV. Current valuation at 2.2x/1.9x FY23E/FY24E P/EV is attractive. Maintain BUY.

Outlook

As we rollover our estimates to FY24, our target price works out to Rs720 (unchanged) by assigning 20x multiple to FY24 VNB of Rs31bn (earlier 25x). At our TP, the stock will trade at 2.52x FY24E P/EV. At CMP, it is trading at 1.9x FY24E P/EV.

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