Buy HDFC Life Insurance Company, target price Rs 670: Emkay Global

Emkay Global has buy call on HDFC Life Insurance Company with a target price of Rs 670. The current market price of HDFC Life Insurance Company is Rs 547.2. Time period given by analyst is one year when HDFC Life Insurance Company Ltd. price can reach defined target.

HDFC Life Insurance Company Ltd., incorporated in the year 2000, is a Large Cap company (having a market cap of Rs 115452.83 Crore) operating in Financial Services sector.

HDFC 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 31-12-2021, the company reported a Consolidated Total Income of Rs 14410.36 Crore, down -30.35 % from last quarter Total Income of Rs 20689.53 Crore and down -47.60 % from last year same quarter Total Income of Rs 27498.74 Crore. Company reported net profit after tax of Rs 275.28 Crore in latest quarter.

Investment Rationale
HDFCLIFE reported ~12% YoY RWRP growth in Mar’22 and 16.4% YoY growth in FY22. On two-year CAGR basis, HDFCLIFE’s growth of 16.9% was higher than the private sector average. With its diversified product offering and omnichannel distribution focus, HDFCLIFE has time and again demonstrated its ability to grow faster than the private sector. For Mar’22 and FY22, HDFC Life’s RWRP growth seems to be driven by the ticket size as the policy count declined. This could be reflecting a reduced volume of retail protection policies in FY22

Promoter/FII Holdings
Promoters held 53.77 per cent stake in the company as of 31-Dec-2021, while FIIs owned 30.78 per cent, DIIs 5.76 per cent.