HDFC Life Insurance Company (HDFCLIFE) Q4 14/15 earnings summary

Executive summary

• Total premium reached ₹14,830 Cr, up 23% YoY; Indian GAAP profit after tax was ₹786 Cr, up 8%; AUM rose 33% to ₹67,047 Cr.

• Individual-segment private-sector market share was 14.8%; overall new-business received-premium share was 15.8%, ranking second among private insurers.

• Profitable growth reflected stronger renewals and persistency, alongside lower operating expenses as a share of premium.

Financial highlights

• Total premium increased from ₹12,063 Cr in FY14 to ₹14,830 Cr in FY15; net premium after reinsurance was ₹14,763 Cr, up 23%.

• PAT was ₹786 Cr versus ₹725 Cr in FY14; investment income rose to ₹12,450 Cr from ₹5,187 Cr, mainly on unit-linked market gains, which were profit-neutral through reserves.

• AUM grew 33% to ₹67,047 Cr; unit-linked funds held ₹44,920 Cr and conventional and shareholder funds ₹22,127 Cr.

• Benefits paid increased 75% to ₹8,234 Cr, primarily from higher unit-linked surrenders and withdrawals; net premium remained positive after benefits paid.

• Individual new-business sum assured rose from ₹77,312 Cr to ₹83,576 Cr; average new-business premium increased from ₹39,483 to ₹45,330.

Outlook and guidance

• FY16 priorities: build an agile multi-distribution platform, sustain digital leadership, innovate product selling and niche categories, and develop economies of scale.

• Planned investment in mobility, tele-sales, analytics, customer servicing and straight-through processing to support growth, efficiency and customer experience.

• Growth prospects were supported by insurance reforms, government social-security schemes and expected economic recovery; management also highlighted rising competition, regulatory change and potential new entrants.