ICICI Pru Margin on Street Radar

Shares of ICICI Prudential Life Insurance Co. Ltd rose nearly 3.4% to ₹586.30 apiece on Wednesday after its March quarter (Q4FY25) results.

- Manish Joshi

The performance, however, was lacklustre, with the annualized premium equivalent (APE) falling 3.2% year-on-year (y-o-y) to ₹3,502 crore.

The stock's gains were likely driven by margin expansion and attractive valuation. The value of new business (VNB) margin improved by 124 basis points (bps) y-o-y and 150 bps sequentially to 22.7%, perhaps helped by a better product mix.

The share of low-margin unit-linked insurance plans (Ulips) declined, but they still accounted for 43% of APE. Ulips saw strong demand earlier in the year amid a booming stock market but faced headwinds from weak equity performance in Q4.

Another driver of margin improvement was the likely revival in premium income from traditional non-linked savings policies, which rose 13.8% y-o-y. The company launched a non-participating guaranteed income product, 'GIFT Select', in Q4. That said, the full-year VNB margin still contracted 180 bps to 22.8% in FY25.