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IOL News
4 days ago
- Business
- IOL News
Momentum Group's third-quarter performance showcases resilience in challenging times
Momentum Group's earnings run rate in the third quarter was in line with the first two quarters, excluding the substantial positive market-related variances of the first six months Image: Supplied Momentum Group's positive financial trajectory at the half-year stage continued into the third quarter, the insurance, investment, and healthcare financial services group said in an operating update on Monday. 'The group delivered solid operational performance despite escalating geopolitical tensions and subdued economic growth, with normalised headline earnings (NHE) of R4.8 billion for the nine months ended 31 March 2025,' its directors said. Recurring premiums increased by 5% in the quarter to R3.1bn. Single premiums fell by 7% to R43.66bn. New business present value premiums fell by 4% to R58.04bn. Total expenses were up by 5%. The number of health members under administration increased by 4%. 'The earnings run rate in the third quarter was in line with the first two quarters, excluding the substantial positive market-related variances of the first six months (of approximately R500 million),' the directors said. They said the results were underpinned by 'disciplined execution across the business units and a continued focus on profitable growth.' The decline in the third-quarter new business present value premiums experience was in line with the trend in the first two quarters. The value of new business (VNB) continued to grow in the third quarter, albeit slower than in the first half. VNB was supported by a shift in new business mix toward more profitable lines and improved performance from Metropolitan Life. Credit spreads on annuity portfolios contributed positively to earnings. Stronger equity market performance supported higher fee income from investment contracts. Direct expenses increased marginally above inflation, largely due to the long-term incentive plan awards on the back of the group's strong share price gains. Other contributing factors on expenses included increased spending to meet compliance requirements from regulatory changes, and IT investment to implement the two-pot retirement system reforms. Benefits from a group-wide performance optimisation project were expected to become more pronounced in the 2026 financial year. To date, R116 million in savings was expected to be realised over the next year. In Momentum Metropolitan Life, the main life insurance entity in the group, the solvency cover ratio (SCR) decreased from 2.15 times at December 31, 2024, to 2.02 times at March 31, with the decrease reflecting strong operational earnings, offset by dividend payments to the group and an increase in the SCR. Momentum Retail's earnings benefited from a solid performance from the protection business and higher investment income on required capital. Favourable market variances contributed positively to earnings. Although still positive, mortality and morbidity experience variances were lower than in the prior period. Momentum Retail's new business premium value improved by 2%. Metropolitan Life's earnings were primarily driven by the improvement in new business profitability, notably on the protection business, following product commerciality and distribution optimisation initiatives. Earnings continued to benefit from positive persistency experience variance. Momentum Corporate's new business premium values fell by 29% to R8.2bn, mainly due to lower FundsAtWork single and recurring premium new business and the impact of sizable single premium large flows in the prior period. 'We are pleased with the performance the Momentum Group achieved over the period. We remain focused on delivering on the Impact strategy, with continued progress on strategic initiatives gaining momentum,' directors said. BUSINESS REPORT Visit:
News18
28-05-2025
- Business
- News18
LIC Shares Rise 9% As Q4 PAT Jumps 38% YoY, Dividend Announced; Should You Invest?
Last Updated: Shares of Life Insurance Corporation of India (LIC) rallied 9 per cent to Rs 948 on May 28 following the release of its Q4FY25 earnings LIC Share Price: Shares of Life Insurance Corporation of India (LIC) rallied 9 per cent to Rs 948 on May 28 following the release of its Q4FY25 earnings. While the results were mixed, most brokerages retained a positive outlook, citing attractive valuations and improved profitability as near-term catalysts. Motilal Oswal reiterated its 'Buy" rating with a revised target price of Rs 1,050. The brokerage highlighted a rising share of non-participating (non-par) policies, which supported an expansion in LIC's Value of New Business (VNB) margin during the quarter. Additionally, management commentary hinted at a recovery in premium growth going forward. Macquarie also maintained an 'Outperform" rating, with a more aggressive target of Rs 1,215. While acknowledging concerns around VNB growth, Macquarie said the stock's low valuation offers downside protection. The brokerage expects an improved product mix and enhanced cost efficiencies to support continued margin growth. However, Goldman Sachs took a more cautious stance, maintaining a 'Neutral" rating and a lower target of Rs 880. The firm flagged weaker revenue from individual participating and group insurance segments, which fell 16 per cent year-on-year. The agency channel also faced headwinds due to the launch of new products on October 1. In terms of financial performance, LIC's Q4 net profit rose 38 per cent YoY to Rs 19,013 crore. However, net premium income declined 3 per cent YoY to Rs 1.4 lakh crore. On a positive note, gross non-performing assets (NPAs) improved significantly, dropping 55 basis points sequentially to 1.46 per cent. The company attributed its muted Annualized Premium Equivalent (APE) growth in FY25 to regulatory changes, which required product redesigns and agent re-training. 'Many products had to be refiled, impacting sales momentum. A higher proportion of single-premium policies also weighed on APE," LIC management told CNBC-TV18. Looking ahead to FY26, LIC aims to achieve double-digit growth in weighted risk premiums and APE. The management expects VNB margins to improve by 2–3 percentage points, reaching close to 20 per cent for the full year. Alongside its earnings, LIC declared a final dividend of Rs 12 per share for the financial year ending March 31, 2025. The dividend is subject to shareholder approval at the upcoming Annual General Meeting (AGM). LIC has fixed July 19, 2025, as the record date. Shareholders on record as of this date will be eligible to receive the payout. The dividend reflects LIC's continued focus on rewarding shareholders amid stable profitability. LIC Share Price History Since its stock market debut in May 2022, LIC has seen significant price swings. After listing at a discount to its issue price of Rs 949, the stock declined sharply, hitting a low of around Rs 530 in March 2023. However, strong earnings recovery and renewed investor interest have fueled a robust rebound. Between late 2023 and mid-2025, LIC shares have climbed steadily. As of May 28, 2025, the stock has gained nearly 60% year-to-date, substantially outperforming broader market indices. Disclaimer:Disclaimer: The views and investment tips by experts in this report are their own and not those of the website or its management. Users are advised to check with certified experts before taking any investment decisions. First Published: May 28, 2025, 12:59 IST
Economic Times
28-05-2025
- Business
- Economic Times
LIC shares zoom 9% as Q4 PAT rises 38% YoY. Should you invest?
LIC impresses with strong Q4 profit, dividend, and bullish broker calls. Synopsis LIC reported a 38% YoY jump in Q4FY25 net profit to Rs 19,039 crore and declared a Rs 12 final dividend. Despite a 3.2% dip in premium income, brokerages remain bullish, with target prices up to Rs 1,260. Analysts highlighted improving margins, APE recovery, and strong equity market support as key positives driving future growth. Shares of India's largest insurer, Life Insurance Corporation of India (LIC), surged 8.8% to an intraday high of Rs 948 on the BSE on Wednesday, after the company reported a 38% year-on-year (YoY) rise in net profit to Rs 19,039 crore for the fourth quarter of FY25. ADVERTISEMENT Additionally, LIC posted a 73% sequential jump in profit, up from Rs 11,009 crore in the December quarter. For the full financial year, the state-owned insurer recorded an 18% increase in profit and reported improvements across key financial metrics, including assets under management and the solvency ratio. The board of the state-run insurer also announced a final dividend of Rs 12 per share. LIC's net premium income for the quarter fell 3.2% YoY to Rs 1,47,917 crore, down from Rs 1,52,767 crore a year ago, but rose 38% sequentially from Rs 1,07,302 crore in the company's Q4 results, here's what analysts from various brokerages had to say: Also read: ITC tumbles 4% on BAT's likely 2.6% stake sale worth Rs 15,000 crore ADVERTISEMENT Motilal Oswal has maintained a 'Buy' rating on LIC with a target price of Rs 1,050, citing improving profitability metrics. While the decline in Annual Premium Equivalent (APE) continues, the Value of New Business (VNB) margin has shown year-on-year the brokerage has revised its VNB margin estimates downward by 50 basis points each for FY26 and FY27, factoring in LIC's FY25 performance. It also highlighted that the increasing contribution from non-par (non-participating) business segments is aiding VNB margin improvement. Antique has reiterated a 'Buy' rating on LIC, raising its target price to Rs 990 from Rs 940 after LIC's steady FY25 financial performance. ADVERTISEMENT The brokerage noted that while APE remained flat, VNB rose 4.5% despite regulatory headwinds from revised surrender value norms. Management expects APE growth to recover gradually in FY26 as LIC adapts to compliant products and higher ticket sizes. Signs of recovery were already visible in March 2025, after a five-month decline triggered by regulatory changes post-October in the better-than-expected Q4, Antique has raised its FY26–27E VNB estimates by about 6% and projects a 5–9% CAGR for VNB/EV with a 10% return on equity (ROE). ADVERTISEMENT Kotak Equities has maintained a 'Buy' rating and raised its target price to Rs 1,260 from Rs 1, a shift in the par business and pressure on non-par margins could lead to sluggish medium-term VNB growth, Kotak highlighted that the recent rally in equity markets will boost investment variance, which had seen large reversals in embedded value (EV) has reflected realized returns (unwinding and economic variance) of about 10% during FY2022–25, including a 25% return in FY2024 and 6% in FY2025. Kotak has built in a 9% CAGR for FY2025–28E. ADVERTISEMENT (Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times) (You can now subscribe to our ETMarkets WhatsApp channel) Nikita Papers IPO opens on May 27, price band set at Rs 95-104 per share Nikita Papers IPO opens on May 27, price band set at Rs 95-104 per share Why gold prices could surpass $4,000: JP Morgan's bullish outlook explained Why gold prices could surpass $4,000: JP Morgan's bullish outlook explained Cyient shares fall over 9% after Q4 profit declines, core business underperforms Cyient shares fall over 9% after Q4 profit declines, core business underperforms L&T Technology Services shares slide 7% after Q4 profit dips L&T Technology Services shares slide 7% after Q4 profit dips Trump-Powell standoff puts U.S. Rate policy in crosshairs: Who will blink first? Trump-Powell standoff puts U.S. Rate policy in crosshairs: Who will blink first? 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Time of India
28-05-2025
- Business
- Time of India
LIC shares zoom 9% as Q4 PAT rises 38% YoY. Should you invest?
Live Events Motilal Oswal: Buy | Target Price: Rs 1,050 Antique: Buy | Target Price: Rs 990 Kotak Institutional Equities: Buy | Target Price: Rs 1,260 (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel Shares of India's largest insurer, Life Insurance Corporation of India (LIC), surged 8.8% to an intraday high of Rs 948 on the BSE on Wednesday, after the company reported a 38% year-on-year (YoY) rise in net profit to Rs 19,039 crore for the fourth quarter of LIC posted a 73% sequential jump in profit, up from Rs 11,009 crore in the December quarter. For the full financial year, the state-owned insurer recorded an 18% increase in profit and reported improvements across key financial metrics, including assets under management and the solvency board of the state-run insurer also announced a final dividend of Rs 12 per net premium income for the quarter fell 3.2% YoY to Rs 1,47,917 crore, down from Rs 1,52,767 crore a year ago, but rose 38% sequentially from Rs 1,07,302 crore in the company's Q4 results, here's what analysts from various brokerages had to say:Also read: ITC tumbles 4% on BAT's likely 2.6% stake sale worth Rs 15,000 crore Motilal Oswal has maintained a 'Buy' rating on LIC with a target price of Rs 1,050, citing improving profitability metrics. While the decline in Annual Premium Equivalent (APE) continues, the Value of New Business (VNB) margin has shown year-on-year the brokerage has revised its VNB margin estimates downward by 50 basis points each for FY26 and FY27, factoring in LIC's FY25 performance. It also highlighted that the increasing contribution from non-par (non-participating) business segments is aiding VNB margin has reiterated a 'Buy' rating on LIC, raising its target price to Rs 990 from Rs 940 after LIC's steady FY25 financial brokerage noted that while APE remained flat, VNB rose 4.5% despite regulatory headwinds from revised surrender value norms. Management expects APE growth to recover gradually in FY26 as LIC adapts to compliant products and higher ticket sizes. Signs of recovery were already visible in March 2025, after a five-month decline triggered by regulatory changes post-October in the better-than-expected Q4, Antique has raised its FY26–27E VNB estimates by about 6% and projects a 5–9% CAGR for VNB/EV with a 10% return on equity (ROE).Kotak Equities has maintained a 'Buy' rating and raised its target price to Rs 1,260 from Rs 1, a shift in the par business and pressure on non-par margins could lead to sluggish medium-term VNB growth, Kotak highlighted that the recent rally in equity markets will boost investment variance, which had seen large reversals in embedded value (EV) has reflected realized returns (unwinding and economic variance) of about 10% during FY2022–25, including a 25% return in FY2024 and 6% in FY2025. Kotak has built in a 9% CAGR for FY2025–28E.
Business Upturn
28-05-2025
- Business
- Business Upturn
Stocks to watch today on May 28: LIC, Aurobindo Pharma, Info Edge among top brokerage picks
Brokerage firms have released fresh research notes on key Indian stocks post Q4FY25 earnings. Life Insurance Corporation of India (LIC), Aurobindo Pharma, and Info Edge are among the most discussed, with analysts offering mixed views based on performance, guidance, and valuation trends. LIC: Mixed reactions amid margin gains and APE concerns Goldman Sachs has maintained a Neutral rating with a target price of ₹880 , citing a 4% APE miss and weak individual/group business performance. The VNB margin stood at 18.7%, up 77 bps vs estimates. Management expects continued focus on non-par products and medium-term margin improvement. Motilal Oswal retained a Buy rating with a target of ₹1,050 , noting VNB margin expansion despite a decline in APE. The brokerage cut its VNB margin estimate by 50 bps each for FY26/FY27. Macquarie gave an Outperform rating with a target of ₹1,215, highlighting the increasing non-par mix and lower cost ratios as supportive of margins, even as VNB growth fell. Aurobindo Pharma: Divergent views on outlook and valuation Citi maintained a Sell call, lowering its target to ₹1,100 , citing a miss on EBITDA (excluding Revlimid contribution) and underwhelming US growth commentary. EPS estimates for FY26-27 were cut by 8%. Goldman Sachs upgraded the stock to a Buy with a target of ₹1,275 , appreciating the company's efforts to maintain margins and deliver topline growth despite Revlimid's impact. They see current valuations as attractive. CLSA maintained an Outperform rating with a target of ₹1,400, noting the company's highest-ever revenue and EBITDA in Q4. However, it trimmed FY26-27 estimates due to guidance and a temporary plant shutdown. Info Edge: Positive long-term outlook with margin trade-offs Citi kept a Buy rating, though trimmed the target to ₹1,675 . The Q4 EBITDA missed estimates due to higher ad spends. However, management remains optimistic about diversified revenue streams and client growth. Nomura echoed similar sentiment, maintaining a Buy with a target of ₹1,670. Recruitment, real estate, matrimony, and education businesses continued to expand, but near-term PBT margins may be under pressure. Other key brokerage actions TTK Prestige : CLSA downgraded to Hold , cutting the target to ₹620 due to weak Q4 results and a significant drop in EBITDA margin. Strategic investments are expected to pay off in the long term. Afcons Infra : Nomura maintained a Buy but reduced the target to ₹560 , citing a weak quarter but strong FY26 guidance. EPS estimates were trimmed by 1%. KEC International: Nomura also retained a Buy with a target of ₹985, acknowledging a soft Q4 but strong order pipeline and an expected 36% EPS CAGR over FY25-28. Disclaimer: The views and recommendations expressed above are those of the respective brokerage firms. Business Upturn does not endorse or offer any investment advice. News desk at
