ICICI Prudential Life Insurance has made a notable impact this quarter, with its shares climbing over 5% after posting a record-breaking profit for Q4FY25. The company’s stellar performance has sparked the interest of investors, but is the stock on a steady growth path, or is there more to the story? Let’s dig deeper.
Key highlights of ICICI Prudential’s Q4FY25 performance
On April 16, 2025, ICICI Prudential Life Insurance’s shares surged more than 5%, hitting an intraday high of ₹599.65, after the company reported a massive 122% year-on-year increase in its net profit, reaching ₹385 crore for Q4FY25. This growth was driven by substantial premium income and strong contributions from the protection and annuity segments.
The company’s net premium income for the quarter rose by 11% to ₹16,369 crore, up from ₹14,788 crore the previous year. Notably, the profit after tax saw a sequential rise of 19%, while premium income surged by 33% compared to the previous quarter.
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A strong finish to FY25
For the entire fiscal year 2025, ICICI Prudential reported a 40% increase in profit after tax, reaching ₹1,189 crore. The company also announced a dividend of ₹0.85 per share, signalling its confidence in maintaining growth.
Other impressive metrics included:
- Value of New Business (VNB): ₹2,370 crore, with a VNB margin of 22.8%.
- Annualised Premium Equivalent (APE): ₹10,407 crore, a 15% increase year-on-year.
- Retail Protection APE: A notable 25.1% increase to ₹598 crore.
- New Business Sum Assured (NBSA): Grew by 37% YoY to ₹3.32 lakh crore.
These numbers highlight ICICI Prudential’s strength in the life insurance sector, particularly in the high-margin retail protection business and annuity offerings.
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Stock performance: a bumpy ride
ICICI Prudential’s stock has had its ups and downs in recent months. Despite the 5.6% gain in April, the stock is still down by 8% over the past year, underperforming its sector. However, there are signs of recovery with a 5.6% rise this month after a tough streak of losses between October 2024 and February 2025.
At its current price of ₹599.65, ICICI Prudential remains almost 25% below its 52-week high of ₹795, reached in October 2024. This suggests that while the company’s fundamentals are solid, the stock has yet to fully recover from its previous struggles.
Key numbers
| Metric | Q4FY25 | FY25 |
| Net Profit (PAT) | ₹385 crore | ₹1,189 crore |
| Net Premium Income | ₹16,369 crore (up 10.7% YoY) | ₹48,951 crore (up 13.2% YoY) |
| Value of New Business (VNB) | ₹795 crore (up 2.5% YoY) | ₹2,370 crore (up 6.4% YoY) |
| VNB Margin | 22.70% | 22.80% |
| Annualised Premium Equivalent (APE) | ₹3,502 crore (down 3.1% YoY) | ₹10,407 crore (up 15% YoY) |
| Retail Protection APE | ₹598 crore (up 25.1% YoY) | ₹8,705 crore (up 13.3% YoY) |
| Dividend | ₹0.85 per share | ₹0.85 per share |
| Assets Under Management (AUM) | – | ₹3.09 lakh crore |
| Solvency Ratio | 212.20% | 212.20% |
| New Business Sum Assured (NBSA) | – | ₹3.32 lakh crore (up 37% YoY) |
| In-force Sum Assured | – | ₹39.43 lakh crore (up 15.6% YoY) |
What’s driving ICICI Prudential’s growth?
The key factors behind ICICI Prudential’s growth include:
- A robust multi-channel distribution model: The company’s ability to leverage various distribution channels has proven effective in maintaining growth, particularly in retail and annuity products.
- A shift towards higher-margin products: The launch of products like ICICI Pru Gift Select, designed to cater to customer demand for guaranteed income, has helped boost margins and attract more customers.
- A strong focus on protection and annuity: The growth in the annuity segment, which saw a two-year compound annual growth rate (CAGR) of 31.4%, has helped ICICI Prudential differentiate itself in a competitive market.
The company’s focus on diversifying its product portfolio, especially moving away from high-risk ULIP products, positions it well for future growth, especially as the demand for traditional life insurance products increases.
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What analysts are saying
Despite the strong financial results, not all analysts are as bullish about ICICI Prudential’s stock.
- Nuvama Institutional Equities has upgraded the stock to a ‘Buy’ rating but lowered its target price from ₹720 to ₹690. This reflects concerns about the 7.8% decline in retail APE and the dip in VNB margins.
- HDFC Securities has maintained an ‘Add’ rating with a target price of ₹665, citing weaker-than-expected APE and VNB growth. The brokerage is cautious due to continued pressure on margins, primarily due to the company’s focus on Unit Linked Insurance Plans (ULIPs), which have lower yields.
These mixed views highlight that while ICICI Prudential has delivered solid results, there are lingering concerns regarding margin pressure and the performance of ULIP-heavy products.
Bottomline
Given ICICI Prudential’s solid financial performance and impressive growth metrics, it’s clear that the company is doing well. However, the mixed views from brokerages and the stock’s recent volatility should make investors cautious.
If you’re considering buying ICICI Prudential shares, keep in mind:
- The company has shown strong growth in premium income and profit, but it faces challenges in margin expansion due to its ULIP-heavy product mix.
- Brokerages have lowered their target prices, suggesting that there may be better opportunities in the market.
Overall, while ICICI Prudential remains a strong player in the insurance sector, investors should monitor the company’s ability to diversify its product offerings and manage its margins going forward.
