Max Financial Services Limited (MFSL) today announced financial results for the year 2020-21 (FY21). In FY21, MFSL reported consolidated revenues of Rs 31,288 Cr, 72% higher compared to the previous year due to gain on debt and equity portfolio. Excluding investment gains, its revenues grew by 17%. During the period under review, the company reported consolidated Profit after Tax of Rs 560 Cr, a jump of 105% compared to the previous year.

The steep surge in the Profit After Tax was largely due to higher investment income, reversal of provision for impairment on financial assets, lower tax expense and a partial offset by new business strain due to shift in product mix towards non-par business.

During the financial year, total new business premium (individual and group) of Max Life increased 22% to Rs 6,826 Cr In terms of individual APE (Adjusted Premium Equivalent), it recorded a 19% growth to Rs 4,907 Cr Further, the renewal premium income (including group) grew 15% to Rs 12,192 Cr, taking gross written premium to Rs 19,018 Cr, an increase of 18% over the previous financial year. 

MFSL’s sole operating subsidiary, Max Life, registered a post-tax shareholders’ profit of Rs 523 Cr in FY21 as compared to Rs 539 Cr in the previous financial year, a marginal decline of ~6%. The operating expenses (policyholders) to gross premium ratio marginally improved from 14.5% in FY20 to 14.2% in FY21 due to effective cost management efforts and higher business growth. 

Max Life reported an Embedded Value (EV) of Rs. 11,834 Cr, after allowing for the shareholder dividends led by 39% growth in value of new business. The Operating Return on EV (RoEV) over FY2021 stood at 18.5%; including non-operating variances, the RoEV came to 22.4%, despite the impact of Covid-19 related provisions.

The New Business Margin (NBM) for FY2021 was 25.2% (at actual costs), an increase of 360 bps and the Value of New Business (VNB) was Rs. 1,249 Cr (at actual costs), an annual growth of 39%.  The higher growth in VNB was primarily on account of the relatively higher sales compared to last year, in addition to the higher margins driven by an increase in the non-par and protection products sales.

Max Life’s assets under management (AUM) was Rs 90,407 Cr as on March 31, 2021 – a rise of 32% over the previous year. Max Life’s Claim paid ratio at 99.35% at the end of FY21 is among the best in the industry.

Q4 FY2021 Performance

During the fourth quarter Q4FY21, MFSL registered consolidated revenues of Rs 9,760 Cr, up 129% from Rs 4,266 Cr in Q4FY20. Excluding investment gains, its revenues grew 21%. In the same period, the company’s Profit After Tax surged 949% to Rs 70 Cr from Rs 6.7 Cr in the year-ago period. 

Max Life recorded a gross premium of Rs 7,106 Cr in Q4FY21, an increase of 21% from Rs 5,873 Cr in Q4FY20. Individual APE grew 35% in the quarter under review to Rs 1,893 Cr from Rs 1,398 Cr in the year-ago period.  

Mr. Mohit Talwar, Managing Director, Max Financial Services, said, “The results are extremely encouraging, considering the challenging environment because of the pandemic. It’s one of our best performance in a decade.”

He added: “The conclusion of the deal where Axis Bank Limited, India’s third-largest private sector bank, became the co-promoter in Max Life with 12.99% stake will permanently address the uncertainty around Max Life’s distribution, and also strengthen its position.”

About Max Financial Services Limited:

Max Financial Services Limited (MFSL) is part of India’s leading business conglomerate – the Max Group. Focused on Life Insurance, MSFL owns and actively manages an 81.83% majority stake in Max Life Insurance, India’s largest non-bank, private life insurance company. 

MFSL recorded consolidate revenues of Rs 31,288 Cr during FY21 and a Profit After Tax of Rs 560 Cr. 

The company is listed on the NSE and BSE. Besides a 17% holding by Analjit Singh and sponsor family, some of the other group shareholders include MSI, Ward ferry, New York Life, Baron, Vanguard, Jupiter, Blackrock, and the Asset Management Companies of Nippon, HDFC, ICICI Prudential, Motilal Oswal, Aditya Birla Sun Life, Mirae, DSP and Kotak. 

About Max Life Insurance Company:

Max Life is the sole operating subsidiary of Max Financial Services Limited. Max Life - a part of the $4-Bn Max Group Max group, an Indian multi business corporation – is India’s largest non-bank private life insurer and the fourth largest private life insurance company.