Q4FY22 preview:HDFC Life Insurance Company: New Business Premium seen at Rs70.7 billion, VNB at Rs8.2 billion

25 Apr 2022 , 12:25 AM

Result date: 26^th April, 2022
Recommendation: Add
Target price: Rs690

HDFC Life Insurance Company could post moderate set of results for the March 2022 quarter. Its new business premium and renewal premium could grow 8% and 19%, respectively over the year-ago quarter. New business premium growth to remain modest on strong trends in Annuity/PAR. Growth in total APE is estimated at 7% on a year-on-year basis. The company’s balanced product mix is helping it navigate the business cycle better than peers.

VNB Margin could contract 40 basis points to 26.5%. Expense ratio is likely to remain stable.

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	70.7	8%
Renewal Premium	75.8	19%
Total APE	31.0	7%
VNB	8.2	6%
VNB Margin	26.5%	(40) bps

Source: IIFL Research