Q4 Results FY ’20

Private life insurer major HDFC Life Insurance posted its Q4 numbers today after market hours.

The company posted a 14.5% Y-O-Y decline in consolidated net profit at INR 311.65 Cr (vs INR 364.88 Cr), impacted by a rise in provisions and a drop in net investment income.

Net premium income growth saw a marginal hike to INR 10,475.95 Cr in the March quarter compared to INR 10,251.26 Cr.

The total new business premium rose by 15% Y-o-Y to INR 17,239 Cr in FY20. The new business margin rose to 25.9% in FY20 as against 24.6% in the year-ago period.

In such a tough market conditions both annualised premium equivalent (APE) and the value of new business (VNB) saw double-digit growth in FY20.

For the full year (FY20), the (APE) rose by 18% Y-o-Y to INR 7,407 Cr while the value of new business rose by 25% to INR 1,919 Cr in FY20.

During the quarter, the insurer made an additional INR 40 crore (equivalent to 4,500 lives) COVID-19 related mortality reserves. This is over and above the policy level liabilities.

HDFC Life Insurance also announced raising of INR 600 Cr of funds through issuance of non-convertible debentures (NCD) in the nature of subordinated debt instrument.

MD & CEO Speaks –

Vibha Padalkar, MD & CEO of HDFC Life said, we continue to deliver growth higher than industry and register steady performance across all key metrics. We believe that insurance remains a multi-decade opportunity with significant potential.

28 March, 2020

Update:

UK’s Standard Life sells 2.5 per cent stake in HDFC Life

UK’s Standard Life (a joint venture partner in HDFC Life Insurance Company) on Friday sold 50000000 shares (or 2.5 per cent stake) in HDFC Life Insurance Company for INR 2,200 Cr through open market transactions.

Shares were sold at INR 441 per share, at about 8 per cent discount to Thursday’s closing price of INR 477.30.

As on 31 December ‘19, Standard Life (Mauritius Holdings) 2006 held 14.73 per cent while Housing Development Finance Corporation (HDFC) held 51.45 per cent stake in HDFC Life Insurance Company.

Leading foreign institutional investors such as Norges Investment Management, Key Square Capital Management, Fidelity Investment, and Capital Group Asset Management are among the buyers which picked up shares of the insurance firm, according to market sources.

The share of HDFC Life Insurance Company Ltd closed 7.63 per cent or INR 36.45 down on NSE when the market closed on Friday.

12 March, 2020

HDFC Standard Life Insurance Company Limited (HDFC Life) is one of India’s leading life insurance companies, offering a range of individual and group insurance solutions that meet various life stage needs of customers.

HDFC Life: Profile

Established in the year 2000, HDFC Life is a prominent long-term life insurance solutions provider in India.

It is a joint venture company between HDFC Limited (Housing Development Finance Corporation and Standard Life Aberdeen plc (one of the world’s largest investment companies)

HDFC Life: Business

• HDFC Life offers a wide range of group and individual insurance solutions including Pension, Protection, Savings & Investment and Health, along with Children’s and Women’s Plan. (As on March 31, 2019, the Company had 11 group and 38 individual products in its portfolio, along with eight optional rider benefits, catering to a various range of customer needs)
• HDFC Life is the most profitable life insurer (based on Value of New Business – VNB margin and among the top 5 private life insurers in India (measured on total new business premium) in Fiscal 2016 and Fiscal 2017.
• Besides consistently being among the top three private life insurers (in terms of profitability based on Value of New Business margin), it has also consistently been among the top three private life insurers in terms of market share based on total new business premium between Fiscal 2015 and Fiscal 2017 (CRISIL report)

HDFC Life: Network

• The company continues to benefit from its presence across the nation with 412 branches and additional distribution touch-points through several partnerships.
• The partnerships comprise 265 bancassurance partners including SFBs (Small Finance Banks), MFIs (Micro Finance Institutions), NBFCs (Non-Banking Financial Companies), etc. and 39 partnerships within non-traditional ecosystems. The Company is also supported by a strong base of financial consultants.
• The Company has 15,406 full-time employees and has over 58,147 individual agents.

Listed On:

The shares of HDFC Life Insurance Company Ltd are presently listed at Bombay Stock Exchange (BSE); CODE 540777 and National Stock Exchange (NSE) as HDFCLIFE

Stock Info

Share Holding Pattern

Financials

Conclusion

The Company is jointly promoted by Housing Development Finance Corporation Limited (HDFC), Standard Life (Mauritius Holdings) 2006 Limited (Standard Life Mauritius) and, Standard Life Aberdeen plc (Standard Life Aberdeen)

Promoters of the company are having more than 76% stake with 0% pledge shares.

It is recently included in the Futures & Options (FO) segment effective February 28, 2020, and anecdotal evidence suggests that after such inclusion most stocks rise in double digits.

On the technical front, the stock is trading below its crucial moving averages 50 EMA and 200 EMA due to on-going market corrections, but keeping other financial ratios (ROE, ROCE etc…) and backed by strong parents the company is a worth add in the long-term portfolio.

Keeping the above-listed factors in mind, HDFC Standard Life Insurance looks good at INR 470. Finblab recommends investing in the stock in a staggered manner for the long term.

Value Pick Stock: February 2020

AMBER ENTERPRISES INDIA LIMITED

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