Motilal Oswal's research report on SBI Life Insurance
SBI Life Insurance (SBILIFE) posted a mixed 2QFY23 with APE clocking a 1% YoY decline (5% miss). However, VNB grew 24% YoY (4% beat) led by ~640bp YoY margin expansion to 31.6%. Shareholders’ PAT grew 53% YoY to INR3.8b. Among segments, Annuity surged 86% YoY while Non-Par savings grew 121% YoY in 2QFY23. Growth in Protection business was modest at 10% YoY; however, along with ULIP business it saw a healthy sequential growth. We increase our VNB margin estimate for FY23 marginally and raise the same by ~240bp for FY24E to 32.1%. We also raise our VNB estimate by 7% for FY24. We expect SBILIFE to deliver 26% CAGR in APE over FY22-24, thus enabling 40% VNB CAGR while RoEV to sustain at ~22%. SBILIFE remains our preferred pick in the Life Insurance space.
Outlook
We maintain our BUY rating with an unchanged TP of INR1,500 (premised on 2.6x FY24E EV).
For all recommendations report, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest business news, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
