Motilal Oswal is bullish on SBI Life Insurance recommended buy rating on the stock with a target price of Rs 1000 in its research report dated September 01, 2020.
Motilal Oswal 's research report on SBI Life Insurance
SBILIFE is India’s largest private life insurer with an Individual WRP market share of 13.3% in FY20. It offers a range of Savings/Protection products and has a distinct competitive advantage in distribution due to its strong parentage. SBILIFE has a wide-spread network of 937 offices across the country with 130,418 productive agents and manages total AUM of INR1.6t as at Mar’20.
Outlook
SBILIFE is in a sweet spot given its strong distribution network, cost leadership and access to its parent SBI’s large customer base. Overall, we expect operating ROEV to normalize toward 18% levels with Embedded Value (EV) reflecting 16% CAGR over FY20-23E. Thus, we value the company at INR1,000/share based on 2.8x FY22E EV. We initiate coverage on SBILIFE with a Buy rating.
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