Q4FY23 Preview: SBI Life Insurance Company: VNB margin seen at 28.6%

25 Apr 2023 , 07:51 AM

Result date: 26^th April, 2023

Recommendation: Buy

Target price: Rs 1,800

 

Analysts at IIFL Capital Services expect SBI Life Insurance Company’s (SBI Life) geographical reach and distribution muscle to aid in driving growth.

SBI Life should witness ~30% growth in APE growth and VNB growth of 38% YoY, aided by 170 basis points margin improvement.

The company is all set to post healthy growth in its New Business Premium during the quarter. It is a cost leader when compared to its peers in the private sector and this trend is likely to continue.

Important management insights to watch out for:

• Growth across product categories
• Product mix, particularly protection products
• Update on actual impact of the changes announced in the Union Budget

Rs Billion	March 2023 estimates	YoY change
New Business Premium	88.5	32.8%
Renewal Premium	118.1	8.9%
Total APE	53.5	29.6%
VNB	15.3	37.9%
VNB Margin	28.6%	170 bps

Source: IIFL Research