ICICI Prudential Life Q2 revenues double, but net profits flat at Rs302cr
ICICI Prudential Life reported an increase of 105.05% in top line revenues for the Sep-20 quarter at Rs16,835cr. The net profits for the quarter ended Sep-20 were almost flat at the same level of Rs302cr.
ICICI Prudential Life reported an increase of 105.05% in top line revenues for the Sep-20 quarter at Rs16,835cr. The net profits for the quarter ended Sep-20 were almost flat at the same level of Rs302cr. The impact on profits was more due to change in actuarial liability that has gone up almost 4 times on a yoy basis, putting pressure on the bottom line.
The net profit margin of ICICI Prudential Life almost halved on a yoy basis at 1.80% and even the solvency ratio was slightly lower at 2.06, when compared on a yoy basis. While the Policyholder Liability ratio was almost flat, the sharp fall in expense management ratio by nearly 270 basis points is a favourable feature.
Financial highlights for Sep-20 compared yoy and sequentially
| Particulars | Sep-20 Quarter | Growth (yoy) | Growth (qoq) |
|---|---|---|---|
| Total Revenues | Rs16,835cr | +105.05% | -11.66% |
| Net Profits | Rs302cr | +0.21% | +5.44% |
| Key Ratios | Sep-20 Quarter | Sep-19 Quarter | Jun-20 Quarter |
| Diluted EPS | Rs2.10 | Rs2.10 | Rs2.00 |
| Net Profit Margin | 1.80% | 3.68% | 1.51% |
| Solvency Ratio | 2.06 | 2.11 | 2.05 |
| Expense Mgmt Ratio | 11.30% | 14.00% | 12.20% |
| Policyholder liab. Ratio | 2104.40% | 2169.80% | 2077.60% |
Key takeaways from the Sep-20 quarter results
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The value of new business in the first half of the FY21 was 15% lower at Rs602cr as compared to Rs709cr in the comparable first half of FY20. This also resulted in a 13.5% fall in the new business premium.
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Despite the lower new business, the value of new business (VNB) margin is up over 500 bps at 26.3% on account of increase in protection mix and the growth in non linked savings schemes.