SBI Life Insurance Company Limited, is a joint venture between SBI and BNP Paribas formed in 2001, which offers individual and group insurance plans, including traditional and unit linked plans. Its products cover life, health, annuity, pension and variable insurance. In Q1FY20, Gross Written Premium (GWP) grew 14.2% YoY, on the back of Renewal Premium. The New Business Premium (NBP) however declined 2.9% YoY, as premiums slid on individual (-28.4% YoY) and protection businesses (-34.1% YoY) front. Annualized Premium Equivalent (APE) witnessed a decline across channels, dropping 32.1% YoY on overall basis. PAT went up 5.1% YoY, owing to rise in Investment income (+188.3% YoY) and lower total expenses (-10.6% YoY). Company's recent tie-up with UCO bank along with its strong market presence and improving VoNB margins on favorable product mix should aid growth going forward.
OutlookWe reiterate our BUY rating on the stock with a revised TP of Rs. 1,018 based on 2.8x FY22E Embedded value (EV).
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