Analysts mixed on HDFC Life post Q1 show

Mumbai: Brokerages have a mixed view on shares of


Insurance Company after the insurer reported a 33% decline in profits for the June quarter.

Shares of HDFC Life ended down 2.21% at ₹663.60 on Tuesday.

Emkay and Jefferies have maintained buy rating while CLSA and Macquarie have retained outperform recommendation.

Edelweiss has maintained a hold rating. Nomura, Credit Suisse and Motilal Oswal are neutral on the stock.

JP Morgan maintained an overweight rating and raised target price to ₹790 from ₹770 but added that it prefers SBI Life Insurance and ICICI Prudential Life, which are trading at 2.3 times FY23 estimated price to embedded value over HDFC Life’s 3.9 times.

“With profitability metrics improving across peers and gaps narrowing now, we think the quality premium for HDFC Life will continue to narrow… we await a better entry point and continue to maintain our neutral stance,” said Nomura.

Credit Suisse said growth is likely to pick up in the second quarter as the economy opens up but margins are likely to remain rangebound given reinsurance cost hikes and stable product mix.