Motilal Oswal's research report on HDFC Life Insurance
HDFCLIFE reported a 11% YoY growth in premium, led by a 16% growth in renewal premium and an 8% growth each in single/first-year premium. Persistency trends remain steady, with 13th/61st month persistency improving 200bp/500bp YoY to 92%/58%. Shareholder’s PAT grew 12% YoY to INR3.6b (in line). VNB growth stood at 15% YoY (~8% beat), with VNB margin expanding to 29.4% (+263bp QoQ). EVOP grew 19% YoY in FY22 (16.6% growth after considering an excess mortality reserve of INR6.5b). On the APE front, the Individual Protection business stood flat YoY v/s a 1% YoY growth in FY22, while strong trends continued in Annuity and the NonPAR Savings business. The ULIP business saw a healthy 24% YoY growth.
We expect HDFCLIFE to deliver ~29% VNB CAGR over FY22-24 and estimate margin to remain ~29% by FY24. We maintain our Neutral rating.
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