Buy SBI Life Insurance Company; target of Rs 2200: Prabhudas Lilladher

Moneycontrol • 4 days ago

Original source

Key Investment Pillars

  • SBI Life Insurance expects 14% APE growth in FY27E, driven by a favorable product mix and increasing traction in non-ULIP products.
  • VNB margin is expected to improve by 20/10bps for FY27/FY28E, supported by a higher share of margin-accretive products and normalization of the GST-related impact.
  • The company plans to launch a regular-pay deferred annuity product in Q3FY27 to broaden its product suite and support NPAR growth.
  • Agency growth is expected to recover over the coming months, with management focused on improving banca sales of NPAR and annuity products.

Thesis Validation Checklist

  • APE growth of 14% in FY27E, driven by a favorable product mix and increasing traction in non-ULIP products.
  • Improvement in VNB margin, supported by a higher share of margin-accretive products and normalization of the GST-related impact.
  • Successful launch of the regular-pay deferred annuity product and its contribution to NPAR growth.
  • Recovery in agency growth and improvement in banca sales of NPAR and annuity products.
  • Persistency and conservation ratios remaining stable or improving, indicating healthy customer engagement and retention.