Meanwhile, the net premium income for the reporting quarter increased 15% YoY to Rs 15,105 crore, compared with Rs 13,104 crore in the corresponding quarter of last year.
The income from investments during the quarter increased 32% YoY to Rs 19,283 crore. It was Rs 14,579 crore in the year-ago quarter.
The first year premium for the June quarter jumped 19% YoY to Rs 3,146 crore against Rs 2,637 crore in the same quarter last year.
The new business for the April-June 2024 period increased 13% YoY to Rs 7,030 crore, while the renewal premium was up 16% YoY to Rs 8,540 crore.SBI Life saw strong growth in 49th month and 61st month persistency in the first quarter by 259 bps and 229 bps, respectively due to the company’s focus on improving the quality of business and customer retention.Also Read: Tata Motors shares rally 4% to fresh 52-week high on Nomura upgrade
Should you buy, sell, or hold SBI Life’s stock? Here’s what analysts say:
Kotak Institutional Equities
Kotak Equities retained its ‘Buy’ rating on SBI Life Insurance with a raised target price of Rs 1,900 (earlier: Rs 1,700).
“SBI Life seems to be improving its growth trends, with concerted efforts to maintain margins, as such it is poised for a good year. Other channels (driven by agency) are growing well. Unlike peers, the company does not need to make large investments to grow in interiors, as it continues to tag on the parent, leading to higher margins than listed peers. We upgrade VNB growth estimates (~2%); we expect the company to deliver 17% EVOP CAGR (FY2024-27E) and 19% operating RoEV,” it said.
HDFC Securities
HDFC Securities maintained its ‘Buy’ rating on SBI Life Insurance with a target price of Rs 1,860.
“Our high conviction BUY is anchored on the three powerful and sustainable moats: (a) exclusive access to SBIβs massive distribution network (penetration at ~2%); (b) scope for improvement in margin accretive traditional mix; and (c) the lowest cost (excl. renewal comm)/APE ratio among peers (Q1FY25: 40.5%, FY24: 41.4%),” it said.
JM Financial
JM Financial maintained its ‘Buy’ rating on SBI Life Insurance with a target price of Rs 1,783.
“We have remained confident in the strength of the companyβs banca and growing agency. We had highlighted that the key monitorables are growth in protection and commission payouts. Discussions on raising commission payouts seem to have phased out, hence, performance on protection growth remains the key, as it will also support VNB margins. We estimate APE/VNB/EV growth of 16.5%/16.5%/19.4% CAGR over FY24-FY26,” said the brokerage firm.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
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