Buy SBI Life Insurance Company; target of Rs 1664: Religare Retail Research

Religare Retail Research report on SBI Life Insurance Company

SBI Life Insurance net premium income during Q4FY24 increased by 12.5% QoQ/26.2% YoY to Rs 25,116cr which was led by growth in the single premium products of 89.8% QoQ/93.4% YoY to Rs 7,710cr. APE during the quarter increased by 17.1% YoY, however, declined sequentially by 13.1% QoQ while new business premium increased by 25.7% QoQ/51.5% YoY. The insurance company reported high growth in its income from investment which aided the top line growth. Commission costs during the quarter declined by 9.1% QoQ/2.3% YoY to Rs 851cr which led to marginal increase in PAT on YoY basis by 4.4% YoY to Rs 811cr.

Outlook

Financially, we expect APE/NBP/VNB to grow at a CAGR of 13%/10%/13% over FY24-26E. We maintain Buy on SBI with a target price of Rs 1,664 valuing the company at 2.1x of its FY26E embedded value per share.

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