Sharekhan's research report on ICICI Prudential Life Insurance Company
ICICI Prudential Life reported 21% growth in VNB. VNB margin expanded to 31.1% in Q2FY2023 (up 500 bps y-o-y/10 bps q-o-q). This was driven by change in product mix. Share of non-linked business (par and non-par) increased to 29% in Q2FY2023 from 26% in Q2FY2022. ULIP was down to 41% in Q2FY2023 versus 51% in Q2FY2022. Increase in annuity and group protection also contributed to margin expansion. APE growth was muted at 1% y-o-y as strong growth in group protection and non-linked savings was offset by weak performance in ULIPs and group savings.
Outlook
We believe the company is expected to deliver a 17% CAGR in VNB over FY2022-FY2024E, driven by premium growth and margin improvement, thus enabling operating RoEV at ~17% in FY2024E. The stock currently trades at 2.1x/1.8x its FY2023E/FY2024E EVPS. We maintain Buy with an unchanged PT of Rs. 660.
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