ICICI Pru reports flat net profit for Q2

Mumbai: ICICI Prudential Life Insurance reported a net profit of Rs 303 crore for the quarter ended September 2020, almost unchanged from Rs 302 crore in the corresponding period of the previous year. Although pre-tax earnings were higher by 8%, a higher tax liability during the quarter flattened profit growth.

The company ended the quarter with assets under management of Rs 1,81,492 crore — an increase of 19% over the corresponding quarter last year. New business premium recovered in the second quarter to end flat for the quarter at Rs 2,957 crore, helping offset some of the decline seen in the first quarter brought on by the strict lockdown in response to the pandemic. The new business premium for the first half was Rs 4,456 crore.

Announcing the results, ICICI Prudential Life MD & CEO N S Kannan said that the value of new business (VNB), or new business profit, for the quarter stood at Rs 401 crore with an expansion in VNB margin to 27.4% from 21.1% in the corresponding period last year. He said that the margins had widened due to market-leading sales of protection policies with the share of protection business increasing to 19.5% from 14.8% a year ago.

“The company’s new business premium was better than our forecast of de-growth of 16%. The performance was mainly supported by a sharp jump of 45% in single premium while first-year premium registered a de-growth of 32%,” said Prayesh Jain, lead analyst at Yes Securities.

Kannan said that risk-aversion among customers led to higher sales of long-term savings product, which grew 45% year-on-year for the quarter. “As part of our strategy to deepen and widen distribution, we forged new strategic partnerships with IndusInd Bank and NSDL Payments Bank. To fulfil our vision of securing the protection and long-term savings needs of Indian families, we will continue to expand and be present across platforms and geographies,” he said.

Source: The Times of India