Citi has maintained its ‘Neutral’ stance on ICICI Prudential Life Insurance, while cutting the target price to ₹650, as the stock currently trades at ₹572.50. The brokerage raised multiple concerns based on the company’s Q4FY25 and full-year FY2025 performance.
Key issues highlighted include a slowing growth trajectory, particularly in unit-linked insurance plans (ULIPs) and non-linked savings products, which declined by 5–10% on a two-year CAGR basis in Q4FY25. Citi also pointed to a weakened margin profile in the group protection segment, where overall protection margins dropped to 55% in FY2025, compared to 75% in FY2024.
Additionally, Citi flagged concerns over mortality assumption changes, with ₹2.54 billion of outflows in FY2025, following a ₹2.88 billion negative variance in FY2024. The report also noted persistency pressures in select cohorts, with non-linked savings persistency down 260 bps (13th month) and 60 bps (49th month), along with a decline in 49th month protection persistency.
Given these structural challenges, Citi has trimmed its FY2026–28E embedded value (EV) estimates by 2–4%, suggesting limited upside in the near term.
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.