Top Indian Companies: SBI Life

SBI Life is an Indian life insurance company which was started as a joint venture between State Bank of India (SBI) and French financial institution BNP Paribas Cardif. SBI has a 55.50% stake in the company and BNP Paribas Cardif owns a 0.22% stake.

SBI Life is a Nifty 50 index with a weightage of 0.67% on the index.

Shareholding Pattern

The Shareholding Pattern page of SBI Life Insurance Company Ltd. presents the Promoter's holding, FII's holding, DII's Holding, and Share holding by general public etc.

Holder's Name No of Shares % Share Holding

No of Shares 1000283298 100%

Promoters 555037374 55.49%

Foreign Institutions 244723759 24.47%

Banks/Mutual Funds 114067172 11.4%

Others 53912718 5.39%

General Public 24491538 2.45%

Financial Institutions 6047125 0.6%

Foreign Promoter 2003612 0.2%

Product segments

• Management highlighted that SBI Life’s margin expansion was not only on the back of increasing share of higher margin products (like non-par savings) and a better cost structure, but also on the fact that within categories, higher margin product variants are selling more.

• SBI Life is not focusing on any target product mix

Individual protection

• Individual protection continued to grow, with 3QFY22 APE at Rs 2.5 bn, up 14% YoY.

• TROP products continue to contribute >80% share.

• There has been no change in reinsurance strategy in this segment.

Group protection

• Group protection clocked 55% YoY growth which was largely contributed by the credit life business.

• Attachment rates were at 47-48%, with current and prior year premium rates remaining the same.ULIPs

• ULIPs recorded an APE of Rs 30.8 bn during the quarter, up 28% YoY.

• While SBI Life’s ULIP mix remains diversified (AUM mix at 46:54 for debt:equity for the stock), incremental flows are geared towards equity (mix at 40:60 for debt:equity).

FY2023 Q4 and Full Year Results

SBI Life on Wednesday reported Rs 77.6 crore net income for the March quarter, marginally up from the Rs 67.2 crore it had booked in the 12 trailing months, despite higher premium and margins.

The largest private sector life insurer in an exchange filing said its first-year premium inched up to Rs 408.9 crore from Rs 385.3 crore, and renewal premium rose to Rs 398.6 crore from Rs 281.2 crore, of which single premium income increased to Rs 1,989.6 crore from Rs 1,743.3 crore during the reporting quarter.

The bottom line was impacted by the massive fall in investment income, which came down to Rs 118.6 crore from Rs 299.9 crore in the year-ago period, the company informed the exchanges. It was also impacted by higher expenses, which rose to Rs 95.8 crore from Rs 87.2 crore.

However, the official press release did not offer any quarterly numbers.

For the full year, its new business premium rose to Rs 29,589 crore from Rs 25,457 crore in March 2022, boosted by regular premium, which increased 17 per cent. For the year, it earned a net income of Rs 1,721 crore.

Protection business rose 19 per cent to Rs 3,636 crore and individual new business premium rose 27 per cent to Rs 20,906 crore.

The company's solvency ratio stood at 2.15x as against the regulatory requirement of 1.50x.

The value of new business grew 37 per cent to Rs 5,067 crore, with a robust margin of 30.1 per cent, up 420 bps for the year.

Assets under management stood at Rs 3,07,339 crore as of March-end, the company said.

Brokerage Outlook

As per B&K Securities, Brokerage view this is ahead of the Brokerage expectations and the street expectations as well and would have a positive impact on the share price,. SBI Life is B&K Securities top pick in the life insurance space.

Brokerage, B&K Securities, believe that SBI Life is well positioned to record growth in the coming quarters on the back of its superior distribution capabilities.

Strong and consistent improvement in margin profile which is now quite comparable to its peers despite a higher mix of ULIPs could be attributed to the company’s superior cost structure.

B&K Securities expect margin profile to improve further as mix of non-par savings and individual protection gears up. Brokerage maintain Buy with a target price of Rs 1,547.

ESG

At SBI Life, we are committed to the well-being of communities with which we coexist. Aligning to national priorities and critical areas of community development, SBI Life’s CSR initiatives are focussed on education and healthcare, enabling mainstreaming of underserved communities towards inclusive and sustainable growth.