Max Financial Services Q4 Review - Growth Trends To Remain Healthy; VNB Margin To Moderate: Motilal Oswal

Motilal Oswal Report

Max Financial Services Ltd. reported a stable quarter on the back of healthy of new business margin of 30.3%. VNB margin was aided by strong growth in VNB (16% beat) and annual premium equivalent (7% beat) due to increased demand before the budgetary changes.

Non-Participating maintained its robust momentum, led by the annuity business, while other segments also saw a sequential recovery.

Growth in APE was driven by the proprietary channels, which rose 90% YoY and contributed ~41% to overall APE. The banca channel’s APE also recovered with 13% YoY growth (up 41% QoQ).

Max Financial Services' management expects the banca channel’s growth to improve further.

We estimate a 15% APE compound annual growth rate over FY23-25, leading to a 13% VNB CAGR.

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