- Life Insurance Corporation of India shows value of new business margin expansion driven by non-par products
- LIC maintains industry leading position with growth driven by higher ticket sizes and channel productivity
- Brokerage raises annual premium and VNB margin estimates for FY26, FY27, and FY28 based on strong growth
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Motilal Oswal Report
Life Insurance Corporation of India continues to report value of new business margin expansion, led by the increasing contribution of the non-par business. The company maintains its industry leading position and expects its growth trajectory to remain at par with the industry, driven by higher ticket sizes, an improvement in agency channel productivity, continued growth in bancassurance and alternate channels, and strong demand post the GST exemption.
A shift toward higher-margin non-par products, cost optimisation, and improvement in persistency will boost VNB margin going forward.
The brokerage raises its annual premium estimates by 7%/5%/5% and VNB margin estimates by 120bp/120bp/50bp for FY26/27/28, considering the strong growth trajectory and increasing non-par contribution witnessed during 9M FY26.
Reiterate Buy with a revised target price of Rs 1,100 (premised on 0.6x FY28E EV).
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