Q4FY22 Preview: SBI Life Insurance Company: New Business Premium seen at Rs74.1 billion, VNB at Rs10.5 billion

27 Apr 2022 , 05:35 AM

Result date: 28^th April, 2022
Recommendation: Buy
Target price: Rs1,540

A strong set of results is expected from SBI Life Insurance Company for the March 2022 quarter. The company’s well diversified geographical reach and healthy distribution network are prominent engines of future growth. In the quarter gone by, the company has witnessed continued momentum in premium across most segments. Rising share of protection products and robust growth in non-PAR products will be key highlights of the quarter and will fuel expansion of VNB margin.

Continued cost leadership in the industry, high persistency ratios and favorable product mix will drive overall profitability of the company.

Consequently, VNB is estimated to grow at 19% over the year-ago quarter and VNB margin could expand 80 basis points to 23.0%.

Important management insights to watch out for:
·         Outlook for growth across segments
·         Commentary on market share trends
·         Improvement in persistency ratio

Rs Billion	March 2022 estimates	YoY change
New Business Premium	74.1	20%
Renewal Premium	105.4	11%
Total APE	45.6	15%
VNB	10.5	19%
VNB Margin	23.0%	80 bps

Source: IIFL Research