In a recent report by Jefferies on Insurance companies, HDFC Life and SBI Life have emerged as the top picks in the insurance sector. The report sheds light on the overall performance of life insurance companies, emphasizing key players and their growth trajectories.
According to Jefferies, HDFC Life and SBI Life are the standout choices in the insurance sector, indicating confidence in their future performance.
The report delves into the December 2023 performance of life insurance premiums, noting a notable uptick in growth. Jefferies reveals that for Dec-23, the retail Annualized Premium Equivalent (APE) growth saw a significant improvement, reaching 9% Year-on-Year (YoY), compared to a combined 4% for October and November.
Private insurance players continued to outperform the market, with an Overall Premium Equivalent (OPF) growth of +11% YoY, gaining market share at the expense of LIC (+2%). Among the listed companies, SBI Life stood out with a robust comeback, registering a 20% YoY rise.
While some companies displayed strong growth, others experienced a slowdown. Max Life’s growth slowed to 15%, and ICICI Prudential’s growth was recorded at 13%, compared to 8% in the combined months of October and November. Notably, HDFC Life faced challenges, marking the weakest performance with a 5% fall in Dec-23.
The report highlights the impressive growth of unlisted players such as Bajaj, Tata, and Birla, with growth rates of 20%, 17%, and 10% YoY, respectively.
Here are the top recommendations of Jefferies in Insurance sector
HDFC Life Insurance: Rating ‘BUY’ for the target of Rs. 800
SBI Life Insurance: Rating ‘BUY’ for the target of Rs. 1700
ICICI Lombard General Insurance: Rating ‘BUY’ for the target of Rs. 1730
ICICI Prudential Life Insurance: Rating ‘BUY’ for the target of Rs. 630
Max Financial Services: Rating ‘BUY’ for the target of Rs. 1200