Stocks

SBI Life stocks: Buy SBI Life Insurance Company, target price Rs 1640: ICICI Securities

has buy call on with a target price of Rs 1640. The current market price of SBI Life Insurance Company is Rs 1270.




Time period given by analyst is one year when . price can reach defined target.

Insurance Company Ltd., incorporated in the year 2000, is a Large Cap company (having a market cap of Rs 125820.21 Crore) operating in Financial Services sector.

SBI Life Insurance Company Ltd. key Products/Revenue Segments include Amount transferred from Policyholder Account, Interest, Dividend & Rent and Profit/Loss on Sale/Redemption of Investments for the year ending 31-Mar-2021.

Financials

For the quarter ended 30-06-2022, the company reported a Standalone Total Income of Rs 4817.29 Crore, down -77.77 % from last quarter Total Income of Rs 21666.15 Crore and down -69.93 % from last year same quarter Total Income of Rs 16021.62 Crore. Company reported net profit after tax of Rs 262.85 Crore in latest quarter.

Investment Rationale
The brokerage estimates 17%/12% APE growth and margins of 31/30% each in FY23/24E. Based on current trends, these are tenable assumptions. This can put EV of FY23E/FY24E at Rs451bn/514bn, implying 2.8/2.4x FY23E/FY24E EV based on CMP, respectively. It maintains BUY on the stock with a revised target price of Rs1,640 (earlier: Rs1,585) based on 20x FY24E VNB. At target price, SBI Life will trade at 3.2x FY24E embedded value. It believes stable and well-performing bancassurance should lead to industry-leading multiple for SBI Life.



Promoter/FII Holdings
Promoters held 55.48 per cent stake in the company as of 30-Jun-2022, while FIIs owned 23.9 per cent, DIIs 12.29 per cent.

(Disclaimer: Recommendations given in this section or any reports attached herein are authored by an external party. Views expressed are that of the respective authors/entities. These do not represent the views of Economic Times (ET). ET does not guarantee, vouch for, endorse any of its contents and hereby disclaims all warranties, express or implied, relating to the same. Please consult your financial adviser and seek independent advice.


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