SBI Life Insurance Shares Have An 18% Upside Target From Geojit

Broking firm Geojit has placed an 18 per cent upside target on the stock of SBI Life Insurance.

SBI Life Insurance Company Limited, is a joint venture between SBI and BNP Paribas formed in 2001, which offers individual and group insurance plans, including traditional and unit linked plans. Its products cover life, health, annuity, pension and variable insurance. Here are some highlights from the the Geojit Report:

• In Q1FY20, Gross Written Premium (GWP) grew 14.2 per cent, year-on-year, on the back of Renewal Premium. The New Business Premium (NBP) however declined 2.9 per cent year on-year, as premiums slid on individual (-28.4% YoY) and protection businesses (-34.1% YoY) front.

  

• Annualized Premium Equivalent (APE) witnessed a decline across channels, dropping 32.1% YoY on overall basis.

• Net profits went up 5.1% YoY, owing to rise in Investment income (+188.3% YoY) and lower total expenses (-10.6% YoY).

"Company's recent tie-up with UCO bank along with its strong market presence and improving VoNB margins on favorable product mix should aid growth going forward. We reiterate our BUY rating on the stock with a revised target price of Rs. 1,018 based on 2.8x FY22E Embedded value (EV)," the Geojit report states.