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HDFC Standard Life IPO: A sneak peak into the financials of the insurer

The insurer had a balance sheet with total net worth of Rs 4,150 crore and a solvency ratio of 197.5% as at June 30, 2017. The life insurer generated profit after tax of Rs 886.92 crore and delivered a return on equity of 25.6%, return on invested capital of 40.7% and operating return on embedded value of 21.7% during fiscal 2017.

BT Online        Last Updated: October 26, 2017  | 11:01 IST
HDFC Standard Life IPO: A sneak peak into the financials of the insurer

HDFC Standard Life Insurance Company, a subsidiary of mortgage lender HDFC, will begin its initial public offer (IPO) from November 7. The IPO which closes on November 9 comprises sale of 1,91,246,050 equity shares, amounting to 9.55 per cent stake, by HDFC and up to 1,08,581,768 scrips, or 5.42 per cent, holding by Standard Life Mauritius, according to a regulatory filing on stock exchanges. We take a look at the key financials of the life insurer.

  • The insurer's solvency ratio as at March 31, 2015, March 31, 2016, March 31, 2017 and June 30, 2017 was 196.1%, 198.4%, 191.6% and 197.5%, respectively. IRDAI has prescribed a minimum 150% solvency ratio limit.The solvency ratio is derived out of the solvency margin (available solvency margin to required solvency margin) which denotes the amount by which the assets of the insurer exceed its liabilities.
  • The insurer had a balance sheet with total net worth of Rs 4,150 crore and a solvency ratio of 197.5% as at June 30, 2017.
  • The life insurer generated profit after tax of Rs 886.92 crore and delivered a return on equity of 25.6%, return on invested capital of 40.7% and operating return on embedded value of 21.7% during fiscal 2017.
  • As at June 30, 2017, the firm had total assets under management (AUMs) of Rs 94,750 crore and Indian Embedded Value of  Rs 13,220 crore.
  •  It recorded a total new business premium for fiscal 2015, fiscal 2016, fiscal 2017 and the three months ended June 30, 2017, was Rs 5492.1  crore, Rs 64,87.22 crore,  Rs 86,96.36 crore and  Rs 16,65.20 crore. Between fiscal 2015 and fiscal 2017, annualised premium equivalent grew by a CAGR of 14.5%.
  •  HDFC Standard Life was established in 2000 as a joint venture between HDFC (one of India's leading housing finance institutions) and Standard Life Aberdeen plc (one of the world's largest investment companies), initially through its wholly owned subsidiary, The Standard Life Assurance Company and now through its wholly owned subsidiary, Standard Life Mauritius. HDFC and Standard Life Mauritius held 61.41% and 34.86% respectively of the insurer's equity shares as on August 18, 2017.
  • The firm delivered a return on equity of 25.6%, return on invested capital of 40.7% and operating return on Embedded Value of 21.7% during Fiscal 2017.
  • Between fiscal 2015 and fiscal 2017, the firm's overall total premium grew by a CAGR of 14.5% to  Rs 19,445 crore, driven by a CAGR of 12.6%, 43.6% and 7.3% in individual new business premiums, group new business premiums and renewal premiums, respectively.

 

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