HDFC Life Insurance Company (HDFCLIFE) Q1 24/25 earnings summary

Executive summary

• Achieved 31% year-over-year growth in individual APE for Q1 FY25, with a 2-year CAGR of 21%.

• Profit after tax grew 15% year-over-year to INR 478 crore; solvency ratio at 186%.

• Persistency improved to 88% (13th month), and claim settlement ratio remained high at 99.7%.

• Tier 2 and 3 markets contributed two-thirds of APE and three-quarters of policies sold.

• Board approved unaudited financial results for Q1 FY25 and in-principle approval for raising up to ₹2,000 crore via NCDs.

Financial highlights

• Value of new business (VNB) for Q1 was INR 718 crore, up 18% year-over-year.

• Total premium for Q1 FY25 was Rs 128.1 bn, up 10% YoY; overall APE grew 23% YoY to Rs 28.7 bn.

• Embedded value stood at INR 49,611 crore as of June 30, 2024, with an operating return on embedded value of 15.5%.

• Solvency ratio at 186% as of June 30, 2024 (standalone and consolidated), above regulatory requirements.

• Profit after tax for Q1 FY25 at Rs 4.8 bn, up from Rs 4.2 bn YoY.

Outlook and guidance

• Focus remains on absolute APE and VNB growth, with flexibility in margin trade-offs.

• Continued investments in tier 2/3 markets and digital transformation (Project Inspire) to drive future growth.

• Confident in doubling VNB in four years, targeting a 19% CAGR.

• Regulatory changes expected to impact margins by 100 basis points if no action is taken.

• Results are subject to seasonality and may not be indicative of full-year performance.