HDFC Life Eyes Long-Term Margin Expansion Despite Tepid Near-Term Growth
Vibha Padalkar, MD & CEO of HDFC Life, said the company will continue to stick with its aspiration and internal mandate—doubling every metric every four years.
HDFC Life Insurance Company Ltd. is banking on steady margin improvement over the next few years even as growth in FY26 is expected to be more subdued compared to the previous year. In a post-earnings conversation, Vibha Padalkar, MD & CEO of HDFC Life, emphasised the company’s commitment to its long-term strategy, saying, “We will continue to stick with our aspiration and internal mandate—doubling every metric every four years.”
While the company had guided for 18% growth last year, Padalkar acknowledged that this year, growth has moderated to 12.5% on Annualised Premium Equivalent, though HDFC Life still outpaced the sector and expanded its market share by 70 basis points to 12.1%, a record high, she said.
Margins, which had been under pressure due to regulatory changes, showed signs of recovery. Padalkar noted, “Despite the impact of new surrender charges, we’ve delivered a 40 basis points increase in margins to 25.1%.” She added that the sector is likely to see “slow but steady margin expansion over the next 3–4 years.”
The macroeconomic backdrop remains a concern, with Padalkar pointing out that “consumption is still sluggish, and trade dynamics are yet to settle.” Still, HDFC Life’s Q1 performance was resilient, net premium income rose 15% YoY to Rs 14,466 crore, net profit grew 14% to Rs 546 crore, and Value of New Business increased 12.7% to Rs 809 crore.
HDFC Life Insurance has emerged as a favoured pick among analysts, with most brokerages maintaining a positive outlook on the stock.
Out of 18 analysts tracking the stock, all but one have issued a ‘buy’ or ‘accumulate’ rating, reflecting broad-based optimism about the insurer’s long-term prospects.
