HDFC Life Q1 Results: Profit Rises, In Line With Estimates
HDFC Life's revenue rose 2.5 times to Rs 23,243 crore, while net premium increased 17% to Rs 11,508 crore.
HDFC Life Insurance Co.'s first quarter profit rose 15% over the year ago period, in line with analyst estimates as premiums increased.
The private insurer's net profit rose to Rs 417 crore in the quarter ended June, according to an exchange filing. That compares with the Rs 399 crore consensus estimate of analysts tracked by Bloomberg. Sequentially, earnings rose 15%.
The company's net premium rose 17% over the same period last year to Rs 11,508 crore.
HDFC Life Q1 FY24 Highlights (YoY, Adjusted For Exide Life)
Revenue rose 2.5 times, to Rs 23,243 crore.
Value of new business—the present value of the future profit associated with new business written during the period—grew 18% to Rs 610 crore. Excluding Exide Life, it grew 20% over the June quarter last year.
VNB margin was 26.2% against 25.1%. Excluding Exide Life, HDFC Life's Q1 FY23 margin was 26.8%.
Renewal premiums grew 14%.
Embedded value rose 29% to Rs 41,843 crore.
The return on EV was 16% as against 15.7%.
Total expense ratio stood at 19.8% as against 19.6% a year ago.
Assets under management were at Rs 2.5 lakh crore, a rise of 19%.
The 13th-month persistency ratio—or customer retention—remained constant at 87%, while for the 61st month, it improved to 53% from 52%.
Solvency ratio—which measures the extent to which assets cover commitments for future liabilities—rose to 200% from 183%. It was 203% as of March 31. This is above the minimum requirement of 150%.
The company's overall product mix comprises 25% unit-linked insurance plans, 33% non-par savings, 9% annuities, 6% protection, and 33% participating policies. The share of ULIP, annuities, and protection has increased while that of par fell 6% and non-par savings declined 1%.
The board has recommended a dividend of Rs 1.90 per share.
"Market share has steadily increased from 12.5% in FY19 to 16.5% in FY23 in the private sector and 7.2% to 10.8% at an overall industry level ... Retail protection trends remain encouraging with year-on-year growth of 45% in Q1 FY24, Vibha Padalkar, managing director and chief executive officer of HDFC Life, said in the statement.
"While the growth is accentuated by a favourable base, we do believe that the pickup in protection is sustainable and the growth is likely to be healthy for the year."
HDFC Bank Ltd. now holds 50.4% of HDFC Life, she said. "Our focus is on strengthening our partnership with HDFC Bank, enhancing collaboration, and maximising customer engagement within our group."
Shares of HDFC Life were trading 3.4% lower on the BSE as compared with a 1.2% fall in the benchmark Sensex as of 2:40 p.m. on Friday.
