Q3FY23 Preview: HDFC Life Insurance Company: Total APE seen at Rs31.9 billion, VNB margin at 28.5%

19 Jan 2023 , 07:37 AM

Result date: 20^th January, 2023

Recommendation: Add

Target price: Rs640

 

Growth in new business premium is estimated to be impacted by weak single premiums. Value of New Business (VNB) growth is pegged at 31% on the back of improved margins. This is commendable especially when viewed in light of lower margin of Exide Life.

Non-Par savings should continue to be the key growth driver, and Retail protection should pick up. Group Savings and Protection may remain weak. Renewal premium is likely to grow at a healthy pace.

Important management insights to watch out for:

• Outlook on Non-Par and Protection segments
• Developments in the competitive landscape

Rs Billion	December 2022 estimates	YoY change
New business premium	74.1	10.4%
Renewal premium	64.5	16.4%
Total APE	31.9	23.0%
Savings APE	28.5	27.0%
Protection APE	3.4	(2.7)%
VNB	9.1	31.1%
VNB margin	28.5%	180 bps

Source: IIFL Research