Value of New Business (VNB) is seen in the range of Rs 2,374 crore and Rs 3,018 crore in the quarter under review. YES Securities remains most conservative in its estimates, suggesting a 19% YoY drop, while Centrum Broking sees it grow by 3% over the corresponding quarter of the last financial year.
VNB is a key performance metric, indicating expected future profits from the new insurance policies and long-term growth potential of the company’s new business.
The overall performance may reflect the impact of regulatory changes, a high base, and evolving product mix — with a continued shift toward non-participating (non-par) and higher-margin products.
The estimates by Kotak Institutional Equities and Emkay Research have also been taken into account.
Here’s what brokerages forecast:
1. Annualised Premium Equivalent (APE)
Most brokerages expect LIC’s APE to decline slightly on a yearly basis due to muted momentum in new business and a high base effect.– Kotak Equities estimates APE at Rs 16,380 crore, down 0.5% YoY but up 29% QoQ.
– Emkay Research expects 4.6% YoY fall to Rs 15,710 crore
– YES Securities projects Rs 14,840 crore, a sharper 10% YoY fall and up 17% QoQ.
– Centrum Broking: Rs 16,213 crore, down 1.5% YoY and up 28% QOQ
Kotak said that LIC’s YoY decline in APE is similar to the run-rate in the first two months of the quarter.
“We pencil in new business growth assumptions based on trends observed till August 2025, when LIC had displayed NBP/APE growth of 21%/35% for 2M2QFY26 (July and August 2025) over 2M1QFY26 (April and May 2025),” YES said in a preview note.
Emkay attributes strong growth in retail APE in the September quarter of FY25 to YoY decline in Q2FY25. The base effect is into play owing to the channel-push prior to the implementation of the new surrender regulations, the brokerage noted.
2. Value of New Business (VNB)
– Kotak Equities: Rs 2,844 crore, down 3.3% YoY and up 46% QoQ
– YES Securities: Rs 2,374 crore, down 19% and up 22% QoQ
– Centrum Broking – Rs 3,018 crore, up 3% YoY and up 55% QoQ
– Emkay Research: Rs 2,821 crore, down 4.1% YoY
VNB performance is expected to remain stable, aided by improved product mix and cost management.
3. VNB margin
– Kotak Equities forecasts a 17.4% margin, down 50 bps YoY and up 199 bps QoQ
– Centrum Broking: 18.6%, up 82 bps YoY and up 325 bps QoQ
– Emkay Research pegs it at 18%, up 10 bps YoY
– Yes Securities expects a QoQ expansion of 63 bps, aided by mix improvement.
4. New Business Premium (NBP)
According to Yes Securities, NBP is expected to come in at Rs 58,677 crore, up 1% YoY but marginally lower 1% QoQ, reflecting steady momentum after a robust start to FY26.
5. Assets Under Management
Emkay Research projects LIC’s AUM at Rs 58.93 lakh crore, up 6.4% YoY, supported by stable inflows and positive market movements during the quarter.
6. Profit After Tax (PAT)
Emkay is the only brokerage among its peers to have given net profit estimates at Rs 8,198 crore, up 7.6% YoY, with continued benefits from steady operational performance.
7. Key monitorables
Investors should keep a track of LIC’s commentary on non-par product expansion and business mix shift, impact of GST ITC disallowance on margins and profitability and growth in group and retail APE segments.
Trends in embedded value (EV) and management guidance for H2FY26, also remain key attributes to watch out for.
(Disclaimer: The recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times.)