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Results
13-Aug-22
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Analysis
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Life Insurance Corporation of India
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Net premium income up 20% in Q1FY2023
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Life
Insurance Corporation of India (LIC) has registered multifold increase in the net
profit to Rs 602.79 crore on consolidated basis in Q1FY2023. The net premium
collection has moved up 20% to Rs 98805.25 crore in Q1FY2023.
The benefits
paid increased 6% to Rs 69134.06 crore, while the commission expenses rose 20%
to Rs 5051.97 crore in Q1FY2023. PAT in the policyholders account increased 1692%
to Rs 4180.29 crore, while transfer to shareholders account jumped to Rs 1269.55
crore.
Investment
income in the shareholders account moved up 433% to Rs 113.72 crore in
Q4FY2022. Total income in the shareholders account declined 18% to Rs 2396.06
crore. The net profit declined 17% to Rs 2409.40 crore in Q4FY2022.
The marketing activity
picked up pace, overall business momentum was strong for LIC and as a result
the overall market share by First Year Premium Income (as per IRDAI) increased
to 65.42% for the quarter ended June 30th 2022 as compared to full year market
share of 63.25% for FY 2021-22. The market share by First Year Premium Income
for the quarter ended June 30th 2021 was 67.52%.
The market share of LIC in
individual First Year Premium Income (as per IRDAI) was 43.86 percent for the
quarter ended June 30th, 2022. In the Group First Year Premium Income (as per
IRDAI), the market share of LIC during quarter ended June 30th, 2022 was 76.43%.
On an Annualised Premium
Equivalent (APE) basis the total premium was Rs 10270 crore for the quarter
ended June 30th 2022. Of this 62.80% (Rs. 6,450 crore) was accounted for by the
Individual business and 37.20% (Rs. 3,819 crore) by the Group Business. Within
the Individual business the share of Par products on APE basis was 92.25% and
balance 7.75% was due to Non par products.
A total of 36.81 Lakh
policies were sold in the individual segment during the quarter ended June
30th, 2022 thereby registering an increase of 59.56% over the similar quarter
last year when 23.07 Lakh policies were sold.
For the quarter ended June
30, 2022, the persistency ratios on premium basis for the 13th month, 25th
month, 37th month, 49th month and 61st month were 75.75.%, 67.78%,
64.34%,60.82% and 58.99% respectively. The comparable persistency ratios for
the corresponding quarter ended June 30th, 2021 were 72.49%, 66.53.%, 62.62%,
59.87, 56%, respectively.
For the quarter ended June
30, 2022, the persistency ratios on number of policies basis for the 13th
month, 25th month, 37th month, 49th month and 61st month were 63.85.%, 56.04%,
51.71%, 48.96% and 47.51%, respectively. The comparable persistency ratios for
the corresponding quarter ended June 30th, 2021 were 61.26%, 53.94.%, 50.58%,
48.22, 44.87% respectively. The persistency has improved across the board both
on premium and policies basis, as compared to quarter ended June 30th
2021.
As at end of June 30th, 2022
LIC had agency strength at 1.33 million, as compared to 1.34 million as on June
30th 2021. The percentage of our agents working in rural areas is 48 % whereas
the remaining 52% operate in urban areas.
The asset under management
increased to Rs 41.02 Lakh crore as on June 30th 2022 as compared to Rs. 38.13
Lakh crore on June 30th 2021 registering an increase of 7.57%.
The Yield on Investments on
policyholders funds excluding unrealized gains was 7.74% for period ended June
30th, 2022 as against 8.39 % for period ended June 30th, 2021. The Net NPAs in
the policyholders fund declined to Rs 9 Crore for the quarter ended June 30th,
2022 as compared to Rs 194 Crore for the quarter year ended June 30th 2021. As
against Gross NPA of Rs 26,620 Crore, NPA provision of Rs 26,611 Crore has been
made for Quarter ended June 30th 2022.
The solvency ratio for the
quarter ended June 30th, 2022 was 188.54% as against 173.34% for the period
ended June 30th, 2021.
The Value of New Business
(VNB) (Gross) for the quarter ended June 30th, 2022 was 1,861 crore. The VNB
margins for the period ended June 30th 2022 are 13.6% (Net). The Gross VNB of
the Individual business was Rs 1277 Crore and for Group business was Rs 583
Crore for quarter ended June 30th 2022. The Gross VNB margins for the
Individual and Group
business were 19.80% and 15.26% respectively. Within the Individual business,
the Par business, Non Par business (including Linked business) had Gross VNB
margins of 14.38% and 84.20% respectively.
M.R. Kumar, Chairperson, LIC
said:- “As the Covid situation normalises, we are seeing a larger activity on
the ground, therefore bringing us back closer to our model of having “feet on
street” and continuous in person engagement with our customers. While the
growth numbers are very robust for the first quarter as seen in comparison to
the same quarter of FY 2021-22, we are aware that the Q1 of the previous year,
FY2021-22 was impacted by a very tough second wave of Covid. However, the
trajectory seems upwards for sure and we are looking at increased business
volumes as is evident in our market share in the year to date since January
2022. Finally, we are glad to inform that LIC has been now included in the
Fortune 500 list of companies and is placed at number 98 in the list. With this
ranking, LIC is the top ranked Indian company on the Fortune 500 list.”
Financial Performance
FY2022
LIC has recorded 6% increase in
the Net Premium Income at Rs 429500.77 crore in FY2022 as compared to Rs 405398.50
crore in FY2021. The Profit after Tax (PAT) for FY2022 was Rs 4124.71 crore as
against Rs 2974.14 crore for FY2021, thereby registering an increase of 39%.
The Yield on Investments on
policyholders funds excluding unrealized gains was 8.55% for FY2022 as against
8.69% for FY2021.
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Life Insurance
Corporation of India: Consolidated Results Policyholders Account
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2206 (3)
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2106 (3)
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Var %
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2203 (12)
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2103 (12)
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Var %
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Premium earned (net)
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98805.25
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82375.62
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20
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429500.77
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405398.50
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6
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Income from
Investments
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69833.72
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72556.91
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-4
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294105.52
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285515.33
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3
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Other income
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162.54
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147.04
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11
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809.66
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12760.49
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-94
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Contribution from the
Shareholders account
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799.24
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0.00
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-
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9.42
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4.76
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98
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Total Income
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169600.74
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155079.57
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9
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724425.37
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703679.08
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3
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Commission
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5051.97
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4217.42
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20
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23305.80
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22358.16
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4
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Op. expenses related
to Insurance business
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10562.26
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6925.26
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53
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21070.03
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34192.90
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-38
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Others
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1692.08
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1655.87
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2
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8673.50
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21809.45
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-60
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Benefits paid (Net)
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69134.06
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65383.17
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6
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359513.65
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290718.12
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24
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Change in valuation of
policy liabilities
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78189.90
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75286.21
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4
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298167.89
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321573.80
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-7
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Provision for taxation
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1452.56
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1606.56
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-10
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7973.30
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9168.16
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-13
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Total Expense
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166082.85
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155074.50
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7
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718704.18
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699820.60
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3
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PAT
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3517.89
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5.07
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69303
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5721.19
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3858.48
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48
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Add: Share of Profit
in Associates
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657.59
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230.11
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186
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4202.57
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1163.35
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261
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(Less)/Add: Minority
Interest
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4.81
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-1.90
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PL
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-6.19
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-446.53
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-99
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Total PAT
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4180.29
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233.28
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1692
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9917.58
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4575.30
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117
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Transfer to Shareholders`
account
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1269.55
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-4.54
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LP
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3883.83
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2956.11
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31
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Life Insurance
Corporation of India: Consolidated Results Shareholders Account
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2206 (3)
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2106 (3)
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Var %
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2203 (12)
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2103 (12)
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Var %
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Amounts transferred
from Policyholders` account
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1269.55
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-4.54
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LP
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3883.83
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2956.11
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31
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Income from
investments
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189.89
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35.99
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428
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317.55
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53.35
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495
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Total Income
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1459.45
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31.45
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4541
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4201.38
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3009.47
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40
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Expenses (apart from
Insurance)
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11.91
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3.89
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206
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27.38
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22.00
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24
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Contribution to
policyholders account
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799.24
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0.00
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-
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9.42
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4.76
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98
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Others
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17.07
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0.48
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3465
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0.00
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0.00
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-
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Total Expenses
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828.22
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4.37
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18862
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36.80
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26.76
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38
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PBT
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631.23
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27.08
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2231
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4164.58
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2982.71
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40
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Tax
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28.44
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2.72
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947
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39.87
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8.57
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365
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PAT
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602.79
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24.37
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2374
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4124.71
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2974.14
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39
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EPS (Rs)*
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3.8
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0.2
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6.5
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4.7
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* on current equity of
Rs 6324.9977 crore of face value of Rs 10 each, PL: Profit to Loss, LP: Loss
to Profit,
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Figures in crore,
Source: Capitaline Corporate Database
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