Result Analysis: ICICI Prudential Life Insurance Company Ltd. (CMP- ₹484.35) | Result Update: Q3FY23 |
ICICI Prudential Life Insurance Company Ltd. (“ICICI Pru.”) is 3rd largest private sector Life Insurance Company and is engaged in the business of providing life insurance, pensions and health insurance products to individuals and groups. The company has consistently been amongst the top companies in the Indian Life insurance sector with a strong balance sheet and solvency ratio of 212.2%. It distributes its products through a large pan-India network of individual agents, corporate agents, banks, and brokers, along with the company’s proprietary sales force and website.
Stock Details | |
Market Cap. (Cr.) | 69677 |
Equity (Cr.) | 1438.56 |
Face Value | 10.00 |
52 Wk. high/low | 640 / 430 |
BSE Code | 540133 |
NSE Code | ICICIPRULI |
Book Value (Rs) | 66.7 |
Sector | Insurance |
Key Ratios | |
Debt-equity: | 0.10 |
ROCE%: | 0.42 |
ROE%: | 6.32 |
EPS TTM: | 5.95 |
P/BV: | 7.30 |
P/E TTM: | 81.40 |
Result Highlights:
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ICICI Pru.’s Revenue stood at Rs 17779 crore, which shows a growth of 78%YoY, and a degrowth of 1.22% QoQ.
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The 13th and 61st month persistency ratios or customer retention by premium improved to 86.1% and 64.2% from 84.8% and 52.7%, respectively, and has improved across all cohorts.
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Solvency ratio that measures the extent to which assets cover commitments for future liabilities, stood at 212% from 202.2%
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Value of new business (“VNB”) i.e. present value of the future profits associated with new business written during the period, grew 23.2% to Rs 1,710 crore.
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Value of New Business margin expanded to 32% from 27.1%.
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The company’s overall cost ratio remained elevated; it went up to 20.8% from 17.7%.
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New business premium grew 10% to Rs 11,287 crore.
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Assets under management grew 6% to Rs 2.52 lakh crore.
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The Company’s profit after tax was 222 crores for Q3-FY23, which showed a growth QoQ of 10.71% and a degrowth of 28.99% YoY
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New business premium was 11287 crores for 9M-FY2023, a growth of 10.1% as compared to 10248 crores for 9M-FY2022.
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APE was 5341 crores for 9M-FY2023, a growth of 4.2% as compared to 5125 crores for 9M-FY2022.
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Annuity APE grew from 216 crores in 9M-FY2022 to 337 crores in 9M-FY2023, registering a growth of 56.0% year-on-year.
Financial Performance:
Shareholding Pattern:
Shareholding Pattern | |
Promoters & Promoter Group | 73.35% |
FIIs | 18.82% |
DIIs | 5.03% |
Public | 2.62% |
Others | 0.18% |
Management Commentary:
S Kannan, managing director and chief executive officer at ICICI Prudential Life, said, “We have maintained positive momentum in business and profitability during the nine months ended FY2023 and have registered a strong year-on-year growth of 23.2% in the Value of New Business, which stood at 17.10 billion for the period ending 9M-FY2023. This consistent track record of healthy compounding of VNB and near doubling of the VNB margin are a result of the “transformative” diversification in products, distribution partnerships and customer segments that began in FY19.
Outlook:
ICICI Pru.’s revenue jumps by 78% YoY at the same time the profits of the company decline by 29% in the same period of time. However, VNB grew at 23.2% along with the persistency ratio which improved across all cohorts of 13th, 25th, 37th, 49th, and 61st months. India’s insurance sector has a low penetration of about 22% which is very low as compared to the other developed nations and going forward it is expected to grow to 125% by FY-2035 which gives the company a huge headroom to grow. The 9M EPS of the company stands at ₹4.02 and we expect it to be at ₹5.36 for FY23 at the P/E of 90.36x
Results:
Particulars (In Cr.) | Q3FY23 | Q2FY23 | Q3FY22 | QoQ % | YoY% | |
Net Premium Earned | 9465 | 9582 | 9074 | -1.22% | 4.30% | |
Other Operating Income | 7962 | 13023 | 856 | -38.86% | 830.28% | |
Other Income | 352 | 507 | 58 | -30.52% | 512.50% | |
Total Income | 17779 | 23112 | 9987 | -23.08% | 78.01% | |
Total Operating Expenditure | 17392 | 22866 | 9506 | -23.94% | 82.95% | |
Operating Profit | 387 | 246 | 481 | 57.32% | -19.62% | |
Provisions & Write-Offs | 110 | 3 | 122 | 3569.67% | -9.46% | |
Profit Before Tax | 277 | 243 | 359 | 13.92% | -23.06% | |
Tax | 55 | 43 | 47 | 28.96% | 15.94% | |
Profit After Tax | 222 | 200 | 312 | 10.71% | -28.99% | |
Segment Premium Income (In Cr.) | Q3FY23 | Q2FY23 | Q3FY22 | QoQ % | YoY% | Segment % |
Par Life | 1,172 | 1,146 | 1,168 | 2.29% | 0.33% | 12.45% |
Par Pension | 2.6 | 1.7 | 3.0 | 52.38% | -14.95% | 0.03% |
Non-Par Life | 2,789 | 2,513 | 1,972 | 10.99% | 41.40% | 29.62% |
Non-Par Pension | 44 | 262 | 16 | -83.19% | 175.44% | 0.47% |
Non-Par Variable | 6.3 | 3.1 | 0.1 | 107.87% | 4776.92% | 0.07% |
Non-Par Variable Pension | 0.0 | 0.6 | 10.8 | -100.00% | -100.00% | 0.00% |
Annuity Non-par | 540 | 703 | 774 | -23.13% | -30.23% | 5.74% |
Health | 6.9 | 7.4 | 7.3 | -6.61% | -5.72% | 0.07% |
Linked Life | 4,453 | 4,405 | 4,733 | 1.10% | -5.91% | 47.30% |
Linked Pension | 33.4 | 35.9 | 42.2 | -6.97% | -20.85% | 0.35% |
Linked Health | -1 | 0 | -1 | -376.60% | 116.67% | -0.01% |
Linked Group Life | 368 | 429 | 168 | -14.31% | 118.35% | 3.91% |
Total | 9,414.70 | 9,507 | 8,896 | -0.97% | 5.83% | 100.00% |
Particulars (In Cr.) | 9M-FY23 | 9M-FY22 | FY22 | YoY% |
Value of New Business (VNB) | 1710 | 1388 | 2163 | 23.20% |
New Business Sum assured | 692193 | 513163 | 773146 | 34.90% |
APE* | 5341 | 5125 | 7733 | 4.20% |
-Savings | 3954 | 4052 | 6120 | -2.40% |
-Protection | 1050 | 856 | 1313 | 22.70% |
-Annuity | 337 | 216 | 300 | 56.00% |
New Business Premium | 11287 | 10248 | 15036 | 10.10% |
Cost ratio (Cost/TWRP^) | 20.80% | 17.70% | 18.60% | |
Profit/(Loss) After Tax (PAT) | 576 | 569 | 754 | 1.20% |
Assets under management | 251884 | 237560 | 240492 | 6.00% |
*- Annualized Premium Equivalent
^- Total weighted received premium
Source: Company website, EWL Research
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