Is it Time to Look at Life Insurance Stocks?

  • Stock Market News
Is it Time to Look at Life Insurance Stocks?
Credit: © Reuters.

By Aditya Raghunath -- Life insurance companies saw solid growth in new business premiums (NBP) in February that rose to Rs 22,425.21 crore, compared with Rs 18,533.19 crore in the same period in 2020, according to data by regulator IRDAI (Insurance Regulatory and Development Authority of India). That’s an impressive increase of 21%.

LIC was the clear winner in February as it saw its new premium income go up 24.18% to Rs 12,920.57 crore compared to Rs 10,404.68 crore in 2020. The remaining 23 players in the category made up the rest of the numbers.

Among private players, SBI (NS: SBI ) Life Insurance Company Ltd (NS: SBIL ) saw an increase of 62% to Rs 1,750.73 crore; HDFC (NS: HDFC ) Life Insurance Company Ltd (NS: HDFL ) was up 20% to Rs 1,895.94 crore and Kotak Mahindra (NS: KTKM ) Life was up 35.5% to Rs 640.26 crore. ICICI Prudential (LON: PRU ) Life Insurance Company Ltd (NS: ICIR ) was one of six players that saw a decline in NBPs. Its numbers fell 19% to Rs 1,737.03 crore.

However, analysts at Jefferies feel the tide could turn for ICICI Prudential Life. “We expect growth trajectory to continue improving for IPRU Life into FY22 on lower base, better environment for ULIPs, traction from new banca partnerships and pickup in credit protect on improving disbursals,” they said in a note.

SBI Life shares are up 13.4% since the end of January to Rs 964 while HDFC Life shares are up 9.3% to Rs 740. ICICI Prudential Life’s shares are up only 1.24% since February.

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