HDFC Life Q4 net profit up 15% on strong renewals

The company's total annualised premium equivalent (APE) remained flat during the financial year mainly due to high base effects from increased sales in March 2023 before the tax rules were changed. Aside from the budget changes impacting high ticket-sized business this year, when had got ₹1,000 crore business, and after adjusting for this one-off business the growth is 20%.

"Considering that higher ticket sizes will be impacted by the tax changes, we previously had mentioned that our focus will shift towards increasing the number of policies, and this strategy has paid off," said Vibha Padalkar, CEO of HDFC Life Insurance. " The growth in the number of policies has been 14% in Q4."

The company declared a dividend of ₹2 per share. Deepak Parekh has stepped down as the chairman and non-executive director of the company with effect from April 18, 2024. Keki Mistry has been appointed as the chairman. Mistry has been associated with the company since December 2000 and is a non-executive director.

Retail APE fell 33% YoY from ₹2,600 crore to ₹1,950 crore.

The company's value of new business (VNB) margin declined to 26.3% from 27.6% and VNB fell 5% during the quarter. "VNB grew by 69% in Q4 2023 which is way above the normal margin and that has impacted the by 70 basis points in this quarter," said Padalkar.

With protection growing higher at 27%, the solvency margin fell to 187% from 203%.