Emkay Global Financial's research report on SBI Life
SBI Life achieved good results for H1FY24, with 20.9% YoY APE growth and VNB margins remaining intact at 28.6% (Emkay Est.: 28%; H1FY23: 31%) led to VNB standing at Rs23.6bn (+11.3% YoY)—a minor beat on our estimate. Against the backdrop of increased share of ULIP in the product mix (+6.4ppts YoY) and reduced share of non-par savings (-8.2ppts YoY), this margin softness is on expected lines. A notable feature of SBI Life’s playbook is that it continues its superb execution by leveraging on its brand, distribution and cost advantage to sell products that meet customer & channel demand. Management reiterated its guidance to grow the topline to around 20%, whereas VNB margin is expected to remain at 28-30% levels, depending on the product mix.
Outlook
Our FY24- 26 estimates remain broadly unchanged and we reiterate our BUY opinion on the stock, with unchanged TP of Rs 1,690/share (implied FY25E P/EV of 2.6x).
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