HDFC Life’s Growth Slows Amidst Flat Annual Premium Equivalent

HDFC Life's Growth Slows Amidst Flat Annual Premium Equivalent
HDFC Life's Growth Slows Amidst Flat Annual Premium Equivalent/Mint
HDFC Life's Growth Slows Amidst Flat Annual Premium Equivalent
HDFC Life's Growth Slows Amidst Flat Annual Premium Equivalent/Mint

HDFC Life’s Growth Slows Amidst Flat Annual Premium Equivalent

HDFC Life’s Growth Slows Amidst Flat Annual Premium Equivalent

HDFC Life’s Growth Slows Amidst Flat Annual Premium Equivalent

Highlights:

  1. HDFC Life Insurance Co. Ltd’s performance in FY24 reflects stagnant growth in annual premium equivalent (APE).
  2. Adjusted for non-recurring premium income, FY24 APE growth was nearly 8% year-on-year, reaching ₹13,290 crore.
  3. Economic profit, represented by the value of new business (VNB), dipped, signaling challenges in assessing the company’s performance.

HDFC Life Insurance Co. Ltd’s performance in FY24 saw a stagnant annual premium equivalent (APE), prompting investors to reconsider their growth expectations. Despite reporting flat APE year-on-year, adjusted figures reveal nearly 8% growth, reaching ₹13,290 crore after accounting for non-recurring premium income from the previous year.

For life insurance companies, APE serves as a benchmark akin to revenues in other industries. However, the true measure of performance lies in economic profit, reflected by the value of new business (VNB). In FY24, HDFC Life witnessed a dip in VNB, signaling challenges in evaluating the company’s overall performance amidst slowing growth and high valuations.

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