How were the quarterly numbers of SBI Life over the weekend?
Answer
Answer
Like most of the other insurance companies, SBI Life also reported lower overall revenues due to lower net investment income. However, premium income for SBI Life was robust and saved the day. Here is a summary of the quarterly numbers of SBI Life.
SBI Life Insurance
Rs in Crore
Dec-21
Dec-20
YOY
Sep-21
QOQ
Revenues
₹ 20,458
₹ 26,552
-22.95%
₹ 25,404
-19.47%
Net Profit
₹ 364
₹ 233
56.35%
₹ 247
47.62%
Diluted EPS
₹ 3.64
₹ 2.33
₹ 2.46
Net Margins
1.78%
0.88%
0.97%
Solvency Ratio
2.09
2.34
2.12
Expense Mgt. Ratio
7.72%
8.38%
8.68%
Policy Holder Liability Ratio
2197.47%
1984.65%
2147.41%
Let me talk about the top line first. SBI Life Insurance reported -22.95% fall in revenues for the Dec-21 quarter at Rs.20,458 crore. One of the major triggers for the sharp fall in revenues was the income from investments falling vertically from Rs.12,777 crore in the Dec-20 quarter to Rs.2,424 crore in the Dec-21 quarter. However, Premium income was higher across the board; including single premiums, first year premiums and renewals.
An important metrics for insurance companies is the value of new business (VNB). For the 9 months of FY22, VNB was 66% higher at Rs.25,900 crore. The total annualized premium equivalent (APE) stood at Rs.10,170 crore. The VNB has grown at a healthy clip of 36% for the said period. SBI Life showed 13th month persistency and 61st month persistency at around 83.87% and 48.88% respectively, showing strong customer retention.
As of the close of the Dec-21 quarter, AUM of SBI Life stood at Rs.250,000 crore. Net profits were higher by 56.4% on yoy basis at Rs.364 crore for the Dec-21 quarter. That is because the fall in investment income was largely offset by a sharp spike in premium incomes. At the same time, actuarial provisioning estimates were sharply lower yoy. PAT margins improved substantially from a level of 0.88% in the Dec-20 quarter to 1.78% in the Dec-21 quarter.