ICICI Prudential Life - Institutional Research Desk at HDFC Securities

Beat on margin; uncertainty in primary banca channel sustains

IPRU continued to print weak APE growth (three-year CAGR at -4% /-5% YoY, -4% vs. estimates); however, VNB margin shot up to 33.9% (+250bps vs. estimates), translating into 20% YoY VNB growth, led by a higher share of group protection, annuities and NPAR savings. The ICICI Bank channel continued to disappoint; however, heavy investments in the agency channel are expected to offset the drag. While we like the company's re-engineered business model, focused more on a diversified product and channel mix, and industry-leading share in sum assured (H1FY23: 15.7%), we are sceptical of the profitability and sustainability in the group protection business. We cut our FY24E/FY25E VNB estimates by 2.7%/5 % to factor in continued uncertainty in the primary banca channel, partly offset by higher VNB margin, and expect VNB to clock a 14% CAGR over FY22-25E. We retain ADD with a lower target price of INR590 (1.9x Sep-24E EV).

Shares of ICICI Prudential Life Insurance Company Limited was last trading in BSE at Rs. 470.40 as compared to the previous close of Rs. 482.65. The total number of shares traded during the day was 45926 in over 1651 trades.

The stock hit an intraday high of Rs. 482.30 and intraday low of 467.50. The net turnover during the day was Rs. 21726268.00.

Source : Equity Bulls

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ICICIPrudentialLifeInsuranceCompany INE726G01019 Q3FY23 ResultUpdate HDFCSecurities