SBI Life's NBP growth weakened to 20% YoY while seeing a tepid APE growth of 11% in FY20 and targets single digit growth for FY21. Though Protection biz growth moderated to 27% YoY it still continues to be the core focus while ULIPs performed better than peers. Margins continued to improve with 100bps YoY ending at 18.7% on back of favorable mix but were weaker than expected on conservative assumptions on future risks. Persistency continued to improve across all cohorts with ULIPs having largely stable experience, while NPar showed improvement.
OutlookOverall operating metrics like persistency, margins, costs etc. expected to remain steady while growth is expected to slow down a bit going ahead. We retain BUY with revised TP of Rs 880 (from Rs 1,127) based on 2.4x (from 3.2x) Mar-22 P/EV.
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