Shares of SBI Life Insurance gained over 3 percent to Rs 1,898 on Monday, October 27, after the insurer reported steady operating performance for the July-September quarter despite a year-on-year decline in profit. Brokerages shared bullish calls on the stock, with optimism about SBI Life’s long-term growth and margin resilience.
SBI Life’s net profit for Q2 FY26 fell 6.6 percent year-on-year to Rs 494.6 crore, compared with Rs 529 crore in the same quarter last year. However, the company’s net premium income rose 22.6 percent to Rs 24,848 crore, driven by strong growth in both first-year and renewal premiums. Linked individual life premiums grew to Rs 10,156 crore from Rs 8,504 crore a year earlier.
Total assets increased to Rs 4.83 lakh crore from Rs 4.42 lakh crore in the previous year, while the solvency ratio stood at 1.94 against 2.04 a year ago. The insurer’s 13th-month persistency ratio improved to 85.4 percent, indicating better policy retention.
Citi shared a Buy rating on SBI Life Insurance stock with a target price of Rs 2,550 per share. The brokerage said that the value of new business (VNB) grew 14 percent year-on-year in Q2, with margins expanding by 100 basis points. The brokerage attributed the improvement to a favourable shift in product mix towards high-yielding segments and said the impact of lost ITC benefits was well absorbed. Citi added that the absence of distributor renegotiations, particularly in the agency channel, supports near- to medium-term growth.
Jefferies also issued a Buy call with a Rs 2,270 target, saying VNB performance was ahead of estimates due to better product mix and higher attachment of protection benefits to savings products. It said that while individual annual premium equivalent (APE) growth was modest at 6 percent year-on-year in the first half, September saw healthy momentum, and management reiterated full-year growth guidance of 13-14 percent. Jefferies expects margins to remain within the guided 26-28 percent range despite GST impact.
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