Nuvama Institutional Equities has upgraded ICICI Prudential Life Insurance to ‘Buy’ from ‘Hold’, while trimming the target price to ₹680, as the stock trades at ₹572.50. The upgrade comes on the back of stable margins and modest growth in value despite some weakness in retail premium collections.
For Q4FY25, group APE surged 33.1% year-on-year, but this was offset by a 7.8% YoY decline in retail APE, leading to a 3.2% YoY decline in total APE for the quarter. However, the company’s product mix improvement helped sustain the VNB margin at 22.7%, up 124 basis points YoY and 150 basis points QoQ.
As a result, Value of New Business (VNB) rose 2.4% YoY to ₹8,000 crore, slightly ahead of Nuvama’s estimate. For the full year, ICICI Prudential reported total APE growth of 15% YoY, while VNB increased 6.4% YoY to ₹23.7 billion, despite a 185bps drop in VNB margin to 22.8%.
Nuvama’s upgrade reflects improved confidence in the company’s ability to manage margin pressures through product repositioning and group business strength, even as retail trends remain mixed.
Disclaimer: The above views are of the broker’s and not the author or the publication’s. Please make any and every investment decision after consulting your financial advisor.