ICICI Prudential Life Insurance Company reported VNB margin of 18.9% in 4QFY18 as compared to 17.5% in 3QFY18 from 10.1% in 4QFY17 mainly on account of new ULIP products which are launched in June 2017 have higher margins and higher share of protection business.
Share of protection business increased to 5.7% in FY18 from 3.9% in FY2017. ULIP declined to 82% from 84% of total APE. Agency and corporate agents gained share from bancassurance and direct business.
Expense/APE was up 50 bps YoY to 13.5%. Solvency ratio dropped to 252% from 281% YoY. Improved operating matrix, mostly on account of better persistency led to high operating RoEV.
ICICI Pru reported a 16% dip in net profit in 4QFY18, primarily on account of higher new business strain resulting from new business growth. We have a buy rating with target of Rs 530.
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