Earnings Review
LIC's Jul-Sept net profit falls 4% on yr to INR 76.21 bln
This story was originally published at 19:21 IST on 8 November 2024
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--LIC Jul-Sept net profit INR 76.21 bln vs INR 79.25 bln year ago
--LIC Jul-Sept net premium income INR 1.199 tbln vs INR 1.074 tln year ago
--LIC Jul-Sept net premium income INR 1.199 tln vs INR 1.074 tln year ago
--LIC solvency ratio at 1.98 times as on Sept 30 vs 1.90 times year ago
--LIC Apr-Sept net profit INR 180.82 bln vs INR 174.69 bln year ago
--LIC Apr-Sept net premium income INR 2.337 tln vs INR 2.058 tln year ago
--LIC 13th month persistency at 68.17% Sept 30 vs 72.35% a qtr ago
--LIC: Market share increased to 61.07% for Apr-Sept from 58.50% a year ago
--LIC: Assets under management up 16.8% YoY at INR 55.40 tln as on Sept 30
--LIC: Indian embedded value at INR 8.22 tln as on Sept 30, up 24.0% YoY
By Pratiksha and Shubham Rana
NEW DELHI – Life Insurance Corp. of India Ltd.'s net profit for the quarter ended September fell 3.8% on year to INR 76.21 billion, the company's quarterly results released Friday showed. Sequentially, the net profit was down 27.2%.
On Friday, shares of the company ended 1.6% lower at INR 914.65 on the National Stock Exchange. The company announced its earnings after the market hours.
LIC's net premium income rose 11.6% on year to INR 1.20 trillion in the quarter under review. Under premium income, single premium rose 24.0% on year to INR 469.36 billion in Jul-Sept, while the first-year premium rose 12.1% to INR 112.01 billion.
Assets under management of LIC increased 16.8% on year to INR 55.40 trillion as on Sept. 30. The solvency ratio of the country's largest life insurer was 1.98 times as on Sept. 30, higher than the regulatory requirement of 1.50 times. The metric was 1.90 times a year ago.
The total premium income rose 13.6% on year to INR 2.34 trillion. In terms of annualised premium, the 13th month persistency ratio, which tracks how long customers stay with their policies, fell to 68.17% as on Sept. 30 from 71.19% a year ago. The 61st month persistency ratio was 54.76%, lower than 55.17% a year ago.
The company's total annualised premium equivalent, including individual and group, rose by 23.9% on year to INR 280.25 billion in the reporting quarter. Employees' remuneration and welfare expenses fell 26.7% on year to INR 77.40 billion and expenses of management fell 12.0% to INR 162.92 billion in Jul-Sept.
The value of new business for the six months ended September was INR 45.51 billion, up 37.7% on year. The net value of new business, or VNB margin, for the six months ended September rose by 160 basis points to 16.2% compared to 14.6% for the six months ended Sept. 30, 2023. The Indian Embedded Value as on Sept. 30 was INR 8.22 trillion as compared to INR 6.63 trillion as on Sept. 30, 2023.
"Our strategy on enhancing market share along with changes in product and channel mix, without compromising on profitability, is yielding very visible results. Further, we have aligned our products with the new regulatory guidelines by redesigning them in such a manner that the interest of customers, shareholders and various marketing channel partners are taken care of," Siddhartha Mohanty, chief executive officer and managing director of LIC, said in a press release.
The product mix of individual annualised premium equivalent saw a rise towards non-participating products. The share of non-participating products increased to 26.31% as on Sept. 30 from 10.76% a year ago. The insurer behemoth's market share in Apr-Sept increased to 61.07% from 58.50% in the same period of previous year and 58.87% for the full year ended Mar. 31. End
Edited by Ashish Shirke
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