ICICI Prudential Life Q2 revenues double, but net profits flat at Rs302cr

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

  • 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.

  • 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.