PL Capital expects private life insurers to maintain healthy growth momentum in Q2 FY27, supported by unit linked insurance plans, non-participating, annuity and protection products, even as GST-related pressures could weigh modestly on margins. The brokerage has reiterated its Buy rating on Max Financial Services, maintaining it its top pick on the back of its strong proprietary distribution channel.
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PL Capital Report
PL Capital expects private life insurers like HDFC Life, SBI Life, Max Life, ICICI Life to deliver a healthy Q2 FY27 performance after recording around 13% YoY growth in July-August 2026. Growth has been supported by a pick-up in ULIPs and non-participating products, strong annuity demand and sustained momentum in protection, though the pace of protection growth has moderated.
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The brokerage expects VNB margins to improve sequentially as the product mix shifts toward margin-accretive protection and NPAR segments. However, the GST exemption is expected to create some drag on profitability.
PL Capital also noted that insurance valuations have corrected significantly amid the prevailing regulatory overhang.
The brokerage has reiterated its Buy rating on Max Financial Services, and has set a target price of Rs 2,025, maintaining it its top pick on the back of its strong proprietary distribution channel.
Key monitorables according to PL Capital are:
- growth trajectory,
- margin outlook, and
- decision on the proposed commission guidelines.
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