ICICI Prudential Life Insurance Company Ltd. share price target

ICICI Prudential Life (IPRU) posted ~16% YoY growth in New Business APE, led by healthy trends in the Protection (19% YoY) and ULIP businesses. Protection growth was supported by higher growth in the Credit Life business, led by improved credit demand and an increase in product pricing. Shareholder PAT stood at INR3.1b (~2% YoY growth). VNB grew ~20% YoY to INR5.15b (~13% beat). This was led by better-thanestimated APE growth and healthy margins at 26.7%. 13th month persistency stood flat at 84.8%, while 61st month persistency improved 290bp (v/s FY21 levels); the company guided for an overall...

ICICI Prudential Life’s (IPRU) business strategy has over the years diversified well enough to remove dependence on ULIPs, any particular bank as well as retail protection. This makes the business more resilient and flexible to adapt to changing consumer demand and was the main reason for our multiple upgrades last quarter.

IPRU posted ~35% YoY growth in new business APE, led by healthy trends in the Annuity segment (~67% YoY), while ULIP growth bounced back strongly (~44% YoY). Protection growth was aided by Credit Life/Group Term, while Retail Protection growth stood weak. On the distribution side, growth was supported across all channels (barring ICICIBC). IPRU continued to improve its distribution mix by adding new partners and agents. VNB grew ~28% YoY to INR5.2b (~7% miss). VNB margin moderated by 130bp YoY to 26%, affected by slower growth in Protection sales....

Despite short-term impact on profitability due to pandemic, company's improved visibility in new business growth opportunities supported by strategic ability to focus on higher margin products keep long-term growth prospects intact. Hence, we reiterate our BUY rating on the stock with a revised TP of Rs. 736 based on 2.6x FY23E EV (Rs. 40,671cr). Improved product mix delivers growth Q1FY22 Gross premium rose by 19.5% YoY to Rs. 6,870cr, whereas net premium income increased 18.9% YoY to Rs. 6,602cr, primarily driven by robust growth in...

IPRU posted ~48% YoY growth in total APE, led by healthy (66%/~164%) trends in the Non-Linked Savings/Annuity business, while linked APE growth bounced back strongly (49%). Growth in the Protection segment was mainly aided by Credit Life/Group term, while Individual Protection saw a decline. Absolute VNB growth was robust (~78% YoY, 15% beat), with VNB margin improving sharply to 29.4% (500bp YoY) v/s 25.1% in FY21. It reported a shareholders' loss of ~INR1.9b on account of higher COVIDrelated provisions and claims settlement. It settled total gross COVID-19 claims of ~INR11.2b over 1QFY22 (3.2x increase over FY21). It has created...

IPRULIFE's Annual Report reaffirms our view that the company will continue to focus on change in product mix, with a higher emphasis on Non-Linked and Protection segment, with new channel partners further aiding business growth. The share of banca channel (excluding ICICIBC) has increased to 11% v/s 5% in FY18. Strengthened distribution will enable further business diversification and drive increasing mix of Non-Linked segment, which will aid margin. The management reiterated its guidance to double FY19 VNB by FY23, aided by: a) opportunity in the long-term Savings business; b) leveraging opportunity in the...

Gross premium income rose 13.7% YoY in Q4FY21 driven by new business premium (+22.9% YoY) and retail renewal premium (+6.1%). VNB stood at Rs. 591cr, while VNB margin contracted marginally to 23.6%, driven by protection mix and non-linked business. PAT reached Rs. 65cr (-63.6% YoY, -78.6% QoQ) impacted by higher benefits paid and rise in actuarial liabilities. Profitability is expected to improve due to strong persistency ratios and reduction in discretionary spends along with growth potential in...

ICICI Prudential Life (IPRU) posted 23% YoY growth in new business premium, led by a steady traction in both regular and single premium business. APE in 4Q grew 27% YoY (22% beat, 27% YoY decline in 9MFY21), led by a 106% growth in Non-Linked Savings APE. Annuity APE grew 215% YoY (120% for FY21), while linked APE growth recovered to 11% YoY. Persistency improved across most cohorts, with 13th month persistency at 84.8% (higher than pre-COVID levels). VNB margin moderated to 23.6% (25.1% in FY21), led by moderation in...

EV growth was strong at 26%; maintains at 3.32bn of COVID reserve for claims ICICI Pru Life's APE growth was strong at 28% YoY/53% QoQ in Q4FY21 leading to FY21 de-growth of 12.5% (44% decline in Q1FY21). Growth improvement helped deliver strong VNB growth of 26% YoY/38% QoQ in Q4FY21 to end FY21 at a 1% growth. Management maintains its guidance to double absolute VNB by FY23 on FY19 base which is 28% average growth for next two years. FY21 had tailwinds on VNB margins of 390bps from business mix change (de-growth in lower margin products) and to achieve double VNB...

IPru Life posted a 7% YoY growth on overall APE and 6% on individual APE, a first positive growth in 13 months. On FYTD21 new business de-grew -27% and is likely to end in negative growth for second consecutive year. IPru Life...