EUR 120.00 For Business Accounts Only

MOSL: Morning India (27/April/20): 1. ICICI Prudential Life Insurance (APE growth declines led by ULIPs; Growth outlook modest); 2. Mindtree; 3. Bharti Infratel; 4. Mahindra CIE; 5. Cummins India; 6. Expert Spe

MOrning India (27/April/20):

Today’s top research idea
ICICI Prudential Life Insurance: APE growth declines led by ULIPs; Growth outlook modest
** IPRU reported weak business trends due to the ongoing lockdown and volatile markets. APE growth declined 20% YoY in 4QFY20 led by ULIPs (-43% YoY) while protection business growth was steady. Protection APE grew 35% YoY, and thus, share of the protection business improved to 17.8% (15.1% in FY20).

** FY20 VNB growth remained steady at 21% YoY led by improvement in asset mix (protection/annuity segment). VNB margins, thus, improved to 21.7% during FY20 (470bp YoY increase).

** Gross premium income moderated to ~5% YoY led by 26% YoY decline in the first year premium while single premium grew ~111% YoY. Renewal premium declined 4% YoY as persistency in the ULIP segment suffered. 13th/25th month persistency declined 140bp/50bp YoY.

** ULIP demand is likely to remain muted though protection/annuity segments are likely to see healthy growth and should help drive steady margins (23% by FY22E). We estimate VNB/new business APE CAGR of ~12%/11% over FY20-22E while operating RoEV should moderate to ~16% for FY22E. Buy with a TP of INR430.

Piping hot news
Tata Steel seeks 500 mn pounds govt bailout in UK: Reports
Tata Steel's UK arm is seeking an estimated 500-million pounds government financial package to survive through the coronavirus lockdown period, according to UK media reports. Tata Steel, which owns the UK's largest steelworks in Port Talbot in Wales, is holding discussions with the Welsh government as well as the UK Treasury as it seeks the 50-million pounds cap set on loans being offered under the UK's Coronavirus Large Business Interruption Loan Scheme (CLBILS) to be lifted.