Earnings Review
HDFC Life Insurance Oct-Dec PAT rises 13.7% YoY, net premium income up 10%
This story was originally published at 18:01 IST on 15 January 2025
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--HDFC Life Oct-Dec net profit INR 4.15 bln
--HDFC Life Oct-Dec net profit INR 4.15 bln vs INR 3.65 bln year ago
--HDFC Life solvency ratio 188% as on Dec 31 vs 190% year ago
--HDFC Life 13th month persistency ratio 78% as on Dec 31
--HDFC Life Oct-Dec net premium income INR 167.71 bln vs INR 152.35 bln yr ago
--HDFC Life Apr-Dec net profit INR 13.26 bln vs INR 11.57 bln year ago
--HDFC Life Apr-Dec net premium income INR 458.51 bln vs INR 414.71 bln yr ago
--HDFC Life Apr-Dec total annual premium equivalent INR 102.93 bln, up 20% YoY
--HDFC Life Apr-Dec renewal premium income INR 246.17 bln, up 12% on year
--HDFC Life: AUM at INR 3.29 tln as on Dec 31, up 18% on year
--HDFC Life value of new business INR 25.86 bln in Apr-Dec, up 14% on year
--HDFC Life new business margin at 25.1% in Apr-Dec vs 26.5% year ago
By Kshipra Petkar
MUMBAI – HDFC Life Insurance Co. Ltd. reported a net profit of INR 4.15 billion for the quarter ended December, up 13.7% on year. Sequentially, the bottom line fell by over 4%. For the nine months ended December, the net profit was INR 13.26 billion against INR 11.57 billion reported a year ago.
The net premium income of the company in Oct-Dec was up 10.1% on year at INR 167.71 billion. The value of new business for the nine months ended December was up 14% on year at INR 25.9 billion. The new business margin for Apr-Dec moderated to 25.1% from 26.5% a year ago.
The life insurer reported strong individual annualised premium equivalent growth of 24% on year in Apr-Dec to INR 89.86 billion, supported by a 15% increase in number of policies sold and a balanced product mix, the company said in a press release. The renewal premiums were up 12% on year at INR 246.2 billion in Apr-Dec.
"We have registered a healthy growth of 22%, based on individual WRP (weighted received premium) for 9MFY25 (Apr-Dec), outpacing overall industry growth of 14%. We have witnessed both ticket size and volume expansion during this period. The number of policies has grown by 15%, outperforming the private sector's growth of 9%," Vibha Padalkar, managing director and chief executive officer of HDFC Life, said in the release.
The assets under management of the company increased by 18% on year to INR 3.29 trillion as on Dec. 31.
Within gross premium income, the first year premiums were up 10.8% on year at INR 29.69 billion in Oct-Dec. On a quarter-on-quarter basis, the first year premiums were down 8.8%. Single premiums of the life insurer were up 10.8% on year at INR 49.31 billion for the quarter. The net income from investments fell more than 98% on year to INR 1.92 billion in the quarter.
In terms of commission, the net commissions were up 55.14% on year at 19.32 billion. Sequentially, they were up 4.4%. This was due to higher commissions on the first year premiums.
In terms of product mix by individual annualised premium equivalent, the share of unit-linked insurance plans increased to 37% in Apr-Dec from 32% a year ago. The share of non-participating savings product increased sharply to 35% from 28% a year ago and the share of participating products fell to 18% in Apr-Dec from 28% in the same period a year ago.
"Retail protection continues to grow well. Retail protection APE (annualised premium equivalent) for nine months saw a growth of 28%," Padalkar said in the release. For Apr-Dec, the retail protection annualised premium equivalent was INR 5.1 billion. Protection and annuity contributed nearly 44% to the new business premium, as per the investor presentation of the company.
The share of various channels for the distribution of insurance products has largely remained unchanged since a year ago. The investor presentation said that the insurance company is restructuring the distributor pay-outs to mitigate the impact on new business margins due to change in surrender regulations by the insurance regulator.
The solvency ratio of the company was 188% as on Dec. 31, comfortably above the regulatory threshold of 150%. The 13th month persistency ratio, which determines the proportion of business renewed from business underwritten, on the premium basis was 81.9%, and on a policy basis, it was 78.0%. The 61st month persistency ratio on a premium basis stood at 57.8% as on Dec. 31 and at 49.1% on a policy basis.
On the National Stock Exchange, shares of HDFC Life closed 1% lower at INR 594.20 on Wednesday. The earnings were announced after market hours. End
Edited by Ashish Shirke
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