KR Choksey has given Buy recommendation for SBI Life Insurance with a target price of Rs. 1435 in its research report issued on Apr 30, 2022
KR Choksey’s research report on SBI Life Insurance
New Business Premium (NBP) grew by 7.7% YoY to INR 66,660 Mn in Q4FY22. New Business Premium (NBP) for the full year FY22 grew 23.4% YoY to INR 254.6 Bn in FY22. Gross Written Premium (GWP) grew by 12% YoY to INR 1,75,085 Mn in Q4FY22. For the full year FY22, GWP grew 16.9% YoY mainly due to 25% growth in First Year Premium (FYP) and 12.4% growth in Renewal Premium (RP). Profit after Tax (PAT) stands at INR 15.06 Bn for FY22. For Q4FY22, PAT stood at INR 6,722 Mn- an increase of 26.3% YoY. AUM grew by 21% YoY to INR 2,674.1 as on 31st March 2022, with debt-equity mix of 71:29. The company’s net worth increased by 12% YoY.
Thus, we continue to apply a 2.6x P/EV on FY24E EVPS of INR 560.2 and a VNB multiple of 16x to arrive at a weighted average TP of INR 1,435 per share (unchanged) for SBI Life (50:50 weights on the P-EV and appraisal value methodology); implying a potential upside of 29.8% from the CMP. Accordingly, we maintain our rating as “BUY” on the shares of SBILIFE.