SBI Life shares jump 3% after 14% YoY rise in Q1 profit. Should you buy?

Shares of SBI Life Insurance Company jumped 2.5% to an intraday high of Rs 1,843.15 on the BSE on Friday, July 25, after the life insurer reported a 14% year-on-year (YoY) growth in net profit for the first quarter of the current financial year (Q1FY26). The company’s profit after tax (PAT) rose to Rs 594 crore in the June quarter.

Net premium income also increased 14% YoY to Rs 17,178 crore, compared to Rs 15,105 crore in Q1FY25. However, both PAT and premium income saw a sequential decline; PAT fell 27% from Rs 814 crore in Q4FY25, while net premium income dropped 28% from Rs 23,861 crore in the previous quarter.

Among its business segments, SBI Life's first-year premium stood at Rs 3,539 crore, down from Rs 4,859 crore in Q4FY25, but higher than Rs 3,146 crore in Q1FY25. Renewal premium for the quarter came in at Rs 10,546 crore, marking a 28% sequential drop from Rs 14,680 crore but a 23% YoY increase from Rs 8,539 crore.


Here's what brokerages said post Q1 show:

Motilal Oswal
The domestic brokerage maintained its Buy rating on SBI Life Insurance, with a target price of Rs 2,140.

The brokerage noted that a shift in the product mix toward non-linked products is supporting improved Value of New Business (VNB) margins. The company has reiterated its guidance for mid-teen Annualized Premium Equivalent (APE) growth for FY26.

Management expects VNB margins to remain in the 26–28% range. Motilal Oswal projects SBI Life to deliver a 16% APE CAGR and 19% VNB CAGR over FY25–27.

The brokerage added that its estimates remain unchanged, and the company’s strong growth outlook is intact.

Nuvama
Nuvama has maintained a ‘Buy’ rating on SBI Life Insurance with a revised target price of Rs 2,250, up from Rs 2,100.

The brokerage noted that strong margins contributed to an earnings beat in the recent quarter. Management is targeting mid-teens Annualized Premium Equivalent (APE) growth and a Value of New Business (VNB) margin of 26–28% for FY26.

Further, SBI Life is revamping its protection portfolio and plans to launch a new money-back product in the participating (PAR) segment. While the FY26E and FY27E VNB estimates remain unchanged, the target valuation has been raised to 2.3x FY27E P/EV.

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