Equity Research Analysis of Life Insurance Sector

A Summer Internship Project Report
On
EQUITY RESEARCH ANALYSIS OF LIFE INSURANCE SECTOR

At
Aditya Birla Sun Life Insurance Ltd. Company
By
Shalaka Rajendra Nalage

MBA (Banking And Financial Services)
Batch - 2019 - 2021
Under the guidance of
Prof. Rupali Kittur
Submitted to
In partial fulfillment of the requirement for the award of Degree of Master in

Business Administration (MBA)
Submitted Through
MIT-WPU School of Management (PG), Pune.

CERTIFICATE
This is to certify that Ms. SHALAKA RAJENDRA NALAGE of
MIT-WPU School of Management (PG) has successfully completed the project work titled
EQUITY RESEARCH ANALYSIS ON LIFE INSURANCE SECTOR
in partial fulfillment of requirement for the award of MBA prescribed by the MIT World
Peace University, Pune, from 15th April 2020 to 30th June 2020
This project is the record of authentic work carried out by her out during the academic year
2020
Prof. Rupali Kittur Ma'am Prof. Dr. T. J. Vidyasagar Prof. Dr. Rajiv Thakur
Internal Project Guide Head of School Director General – Provost
School of Management (PG) School of Management (PG) Faculty of Management

ACKNOWLEDGEMENT
I would like to thank my guide from Aditya Birla Sun Life Insurance Ltd. Mr. Jitendra Bpana.
for his continuous guidance and support which helped me to successfully complete my internship
with a significant amount of knowledge. I would also like to thank Prof. Dr. Rajiv Thakur, School
of Management (PG) at MITWPU for constantly being a source of great motivation. I also thank
Prof. T.J. Vidyasagar, Head of school, Program Head and Class in charge Prof. Shraddha
Kokane, at MITWPU, for their knowledge and expertise that provided essential qualitative research.
I express sincere gratitude to my institute guide, Prof. Rupali Kittur for her continuous guidance
and support which helped me to successfully complete my internship with a significant amount of
knowledge and valuable inputs.
CERTIFICATE
TO WHOMSOEVER IT MAY CONCERN
This is to certify that Ms. Shalaka Rajendra Nalage has successfully completed her summer
training with us from 15th April 2020 to 30th June 2020.
She has completed her project on Equity Research Analysis On Life Insurance Sector
During the summer training, her Performance was Excellent.
She has also attended the training on Portfolio Management, Equity Research
& Derivatives which includes Equity, Debt, Mutual Fund, Insurance,
Fundamental Analysis, Technical Analysis, Derivatives.
We wish her all the best in her future endeavors.
For Aditya Birla Sun Life Insurance

Limited.
Internship Mentor.
DECLARATION
I, Ms. SHALAKA RAJENDRA NALAGE Hereby declare that this project is the record
of authentic work carried out by me during the academic year 2020 . This project is
plagiarism free and has not been submitted to any other University or Institute towards the
award of any degree.
Signature of the student
(SHALAKA RAJENDRA NALAGE.)

INDEX
SR. No. PARTICULARS Page No

1 Abstract. 7
2 Introduction. 9
3 Objectives of the project. 10

4 Company profile. 12
5 Industry profile (Insurance Industry). 15
5.1 Insurance History in India. 18
5.2 Service and product profile. 19
5.3 Major Players of Industry. 21
6 Literature Review. 22
7 Research Methodology . 25
8 Fundamental Analysis.
8.1 Introduction to Fundamental Analysis. 26
8.2 Country Analysis. 27
8.3 Sector Analysis. 36

8.4 Company Analysis
8.4.1 HDFC Life Insurance Company Ltd. 42
8.4.2 ICICI Prudential Life Insurance Company Ltd. 54

8.4.3 SBI Life Insurance Company Ltd. 65
9 Findings and Suggestions.
9.1 Valuation and Comparison Growth of companies 76
10 Conclusion and Limitations. 82
Appendixes.
Bibliography and References.
6
TABLE AND FIGURE INDEX
TABLE NO. PARTICULARS PAGE NO.
1 Listing information of HDFC Life Insurance co. 43

2 Management team of HDFC Life Insurance co. 44
3 Shareholdings of HDFC Life Insurance co 45
4 Total shareholdings of HDFC Life Insurance co 46
5 Financials and ratios of HDFC Life Insurance co 51

6 Listing information of ICICI prudential Life Insurance co. 55
7 Management team of ICICI prudential Life Insurance co. 55

8 Shareholdings of ICICI prudential Life Insurance co. 56
9 Financials and ratios of ICICI prudential Life Insurance co 62
10 Listing information of SBI life insurance co. 66

11 Management team SBI life insurance co. 66
12 Shareholdings of SBI life insurance co. 68
13 Financials and ratios of SBI life insurance co. 73
14 Comparative Growth of HDFC life, ICICI prudential, and 81
SBI life insurance companies
7
1. ABSTRACT.
This project is about the equity research analysis of the life

insurance sector in India. In this project I learn about the working of life
insurance sector. and also I go through the different companies annual reports
and their financials. I am doing internship with the Aditya Birla Sun Life
Insurance Company Ltd. and my project objectives which includes the
information about companies, the financials of company, as well companies
profitability, and the valuations of the life insurance companies.
Equity research mainly means analyzing the company's financials

where we do some ratio analysis, and understood the financial conditions of
the company, and then we will do the valuations of shares according to that
investors will decide whether to invest in or not.
Equity research is all about the valuation of a listed company. i.e.

listed companies trade on stock exchange BSE & NSE. while doing equity
research we consider the economic aspects like GDP, growth rate, market size
of the industry and do the company analysis of life insurance sector..once this
is done, once we did company analysis then we will understand the financial
position of the companies in market, and the growth rate of the companies of
giving returns.
Equity research analysis is very important aspect of the companies

developments and also helpful to analyses the demand of the shares of the
particular company in different market situations. most of the investors are
depend on the provided reports of the company.
8
In this project I am going to do fundamental analysis , ratio analysis and
the valuation of the companies of life insurance sector. now the question is
WHAT IS THE RELATION BETWEEN LIFE INSURANCE

POLICIES AND EQUITY RESEARCH?
Answer :-
Insurance companies are giving ULIP Plans. which are (Unit
Link Insurance Plan) This plans deals with the equity and mutual funds and
that is why equity research is needed in listed life insurance companies.
Insurance companies are provides the protection plus investment plans.
This is the reason for which listed life insurance companies need to
do the equity research. As I said that these life insurance companies are
provide investment place plus insurance plan then they have to engage with
the investment activities e.g. Insurance Companies, Pension Fund Companies,
Asset management firms, etc and therefore it is very important and essential to
do equity research before putting clients money into it.
For doing this project I am referring some sites and articles about the
equity research of the life insurance sector.
9
2. INTRODUCTION.
Equity research mainly means analyzing the company's financials

where we do some ratio analysis, and understood the financial conditions of
the company, and then we will do the valuations of shares according to that
investors will decide whether to invest in or not.
Equity research plays an important role that fills the information

gap between the buyers and sellers of the shares. because every investors i.e.
individual or institutional may not have the resources, or capability to analyse
every stock.
Equity research tries to find the value stock out of the massive ocean
of stocks and help buyers to generate profits. the main purpose of equity
research is to provide insights into the financial performance of a company
and highlight the potential risk posed to its investors.
Equity research also plays very important role to maintain the

stabilised profitability of the company. and this helps to increase in the
market performance and market capital of the company.
10
3. OBJECTIVE
3.1 OBJECTIVES:
OBJECTIVES OF THE PROJECT :-

To gain the knowledge about why life insurance sector's do equity
research.
To get knowledge about the how life insurance perform in market.
To give signals to investors on sell, hold, and buy shares.
Analyze post COVID-19 impact on the life insurance sector.
3.2 SIGNIFICANCE OF STUDY:

This project project will help to understand the equity concept. and the
financial position of company.
This study will help individuals to earn more profits by investing in a
good company. that means equity research can helps the investors to
tack decision where to invest their money.
This study is also very useful to know the company do the equity
research, so that they can maintain their company's profitability and
market position.
3.3 SCOPE OF THE STUDY:-
This research analysis includes only fundamental analysis.

This research paper is a secondary research so that it only consider
the financial statements of the company and annual report of the
particular company. and other websites like screeners.com, money
control. com, stockheadge.com etc.
Pre COVID 19 to post COVID 19 with the help of the news and
articles published by the expertise.
To analyses market trend and observe how it is affecting companies
earnings and their stock values. focusing on a Life Insurance sector
11
Online training of ABSLI , and also under the guidance of expertise.
and past financial data of company.
12
4. COMPANY PROFILE.
5.1. COMPANY PROFILE :-
INTRODUCTION OF ADITYA BIRLA GROUP :-
Fig. No 1
The Aditya Birla Group is India’s first actually multinational

corporation, with a very big vision, but never compromises with the values,
the group is obsessed by performance ethic , pegged on value creation for its
multiple stakeholders. A US$ 24 billion conglomerate, with a market
capitalization of US$ 24 billion and in the confederation of destiny 500, it is
anchored by an extraordinary belonging to over 25 different nationalities.
Over 50 % of its revenues flow from its operations across the world.
The Group’s products and services offer different solutions worldwide .Its 85
state-of-the-art industrialized units and sect oral services cover 20 countries –
India, Thailand, Laos, Indonesia, Egypt, Canada, Australia, China, USA, UK,
Germany, brazil, Italy, France, Switzerland, Malaysia and Korea ,etc
The group has been adjudged the best employer in India and among the
pinnacle 20 in Asia by the Hewitt-Economic Times and Wall street journal
Study 2007.
13
In India the group holds a leader position as :-
India’s leading copper producer

A premier branded garments competitor.
The second largest player in viscose fiber.
The instant largest player in the chlor alkali sector.
amid the top five mobile technology players
A leading participant in Life insurance & asset management.
INTRODUCTION OF ADITYA BIRLA SUN LIFE

INSURANCE :-
source : Google image

Fig No :2
Aditya Birla Sun Life Insurance Company Limited (ABSLI), is a

life insurance subsidiary of Aditya Birla Capital Ltd (ABCL). ABSLI was
integrated on August 4th , 2000 and started operations on January 17th , 2001.
ABSLI is a joint venture between the Aditya Birla Group (51%) and Sun Life
Financial Inc.(49%), Which is a top international financial services
organization in Canada.
BSLI became one of the leading players in the industry of Private Life
Insurance design.
Birla Sun Life Insurance believes in passion, reliability, speed,
pledge and seamlessness. The mission of the company is to help people with
14
risk management. It also helps in organization of the financial situation of
firms as well as individuals. Here is given a complete list of policies and
products offered by Birla Sun Life Insurance Co. Ltd.
Birla Sun Life Insurance developed the unique Unit Linked Insurance
Solutions in India.
Within 4 years of its launch, BSLI has tiled its position as a main player in the
private life insurance industry.
There has been focal point on Investment Linked Insurance Products to
maintain leadership in product innovation.
15
5. INSURANCE SECTOR PROFILE.
The insurance sector in India has come a full circle from being an
open competitive Market to nationalization and back to a liberalized market
again. Tracing the Developments in the Indian insurance sector reveals the 360
degree turn witnessed over a Period of almost two centuries.
The insurance industry of India has witnessed major growth in
the past few decades. With the new introduction of products and plans,
Insurance helps customers by providing financial protection but also
contribute towards nation's economy. A well developed insurance sector act
as the backbone of a nation as it supports the citizen even in unexpected event.
Fig No :3
16
The insurance sector in India is majorly divided into 2 categories :-
Life Insurance.
General Insurance.
Life Insurance :-
Life insurance or life assurance is a contract between the policy owner and
the insurer, where the insurer agrees to pay a designated beneficiary a sum of
money upon the occurrence of the insured individual's or individual's death or
other event, such as terminal illness or critical illness. In return, the policy
owner agrees to pay a stipulated amount at regular intervals or in lump sums.
There may be designs in some countries where bills and death expenses plus
catering for after funeral expenses should be included in Policy Premium. In
the United States, the predominant form simply specifies a lump sum to be
paid on the insured's demise.
Life insurance is a type of insurance. As in all insurance, the insured transfers
a risk to the insurer. The insured pays a premium and receives a policy in
exchange. The risk assumed by the insurer is the risk of death of the insured.
There are various types of insurance policies available today to
protect your loved once and the things you love. In Life Insurance policy,
Insurance indemnifies to pay the insured person's family.
In India, there are 24 life insurance companies operating which have been
approved and recognized by IRDAI (Insurance Regulatory and Development
Authority in India. ) which is a authority body of Insurance Industry.
WHAT IS IRDAI :-
IRDAI Is designed to safeguard and protect the interest of the policy

holder and to check that their rights are not violated by any company. Role of
IRDAI is to monitor the entire insurance sector of India. It also acts as a
custodian of the rights of the policy holders. It makes sure that all the
companies are surviving by the rules so as to safeguard the rights of citizens of
India.
17
THE INSURANCE REGULATORY AND DEVELOPMENT
AUTHORITY ACT, 1999
To permit the private companies to enter the insurance market, the
Government enact the Insurance Regulatory and Development Authority Act
1999, which was passed by the assembly in Dec 1999. It received Presidential
assent in January 2000.
The authority is a ten member team consisting of
a) 1 Chairman;
b) 5 whole-time members;
c) 4 part-time members.
CERTAIN NORMS FOR ENTERED IN LIFE INSURANCE SECTOR
OF IRDAI :-
It is mandatory for each and every company to have paid up capital of Rs 100
crore prior to grant of license.
85% of premium collected by any ins urer has to be invested in the Central
government, state government and other approved road and rail network bonds
and securities
Although all private insurance companies can have a foreign partner to the
extent of 26% in their equity, not a single rupee can be invested out of India
i.e. in foreign investment. Now the foreign partner can have joint venture ship
with 45%of equity.
18
5.1 INSURANCE HISTORY IN INDIA.
The business of life insurance in India in its existing form started in

India in the year 1818 with the establishment of the Oriental Life Insurance
Company in Calcutta. Some of the important milestones in the life insurance
business in India are:
1912 : The Indian Life Assurance Companies Act enacted as the first statute to
regulate the life insurance business.
1928 : The Indian Insurance Companies Act enacted to enable the government
to collect statistical information about both life and non-life insurance
businesses.
1938 : Earlier legislation consolidated and amended to by the Insurance Act
with the objective of protecting the interests of the insuring public.
1956 : 245 Indian and foreign insurers and provident societies taken over by
the central government and nationalized. LIC formed by an Act of Parliament,
viz. LIC Act,
1956 : Started with a capital contribution of Rs. 5 core from the Government
of India.
1907 : The Indian commercial Insurance Ltd. set up, the first company to
transact all classes of general insurance business.
1957 : General Insurance Council, a building of the Insurance Association of
India, frames a code of conduct for ensuring fair conduct and sound business
practices.
1968 : The Insurance Act amended to regulate investments and set minimum
solvency margins and the Tariff Advisory Committee set up.
19
5.2. SERVICE AND PRODUCT PROFILE.
Company gives 6 types of plans are as follow :-

1) Term Plan
2) Premium Back Term Plan
3) Endowment plan
4) Guaranteed plans
5) Guaranteed + Bonus Plan
6) ULIP ( Unit Link Insurance Plan).
Term Plan
Premium Back Term Plan Endowment plan
Insurance
plans
Guaranteed + Bonus
Plan
Guaranteed plans
ULIP ( Unit Link Insurance

Plan).
Fig No :4
20
BRIEF ABOUT PRODUCTS :-
1. TERM PLAN :- Premium is very low which is a positive side but, no

additional returns is the negative side.
2. PREMIUM BACK TERM PLAN :- Positive sides of this plan are
premium is low, and paid all premium will be returned. and the negative side
is premium is higher than term plan by 25% to 50% and no additional returns.
3. ENDOWMENT PLAN :- It is insurance plus investment plan. interest for
the plan is calculate from debt market, and bonus is declared every year which
can be increase. which are positive things but as bonus can be increase same
way it can be decreases which is negative thing only in this plan.
4. GUARANTEED PLAN :- It is a insurance plus investment plan. interest
for the plan is calculate from debt market and decreasing debt returns will not
affect the returns which is a good thing, but increasing debt returns also not
given to investor.
5. GUARANTEED PLUS BONUS PLAN :- It is a insurance plus
investment plan. interests are calculate from debt market i.e. If debt returns
goes up, it will be given to client, if returns goes down or decreases then it will
not impact. The policy returns as a part of guaranteed returns.
6. ULIP (Unit Link Insurance Plan) :- This plan is a insurance plus
investment plan. but investment of this plan is done in mutual funds and
equity. and therefore it is a combo of mutual funds and equity.
It deals with the equity also and therefore equity research is a need for this
plan. this plan is little bit risky than others as the premium or the invested
amount is higher compared to the other plans and returns are totally depend on
the marker returns if market goes up then higher returns will given and vice-a-
versa.
Life is unpredictable. But in face of adversity, our responsibilities towards our
parents, children and loved ones need not be compromised. Insurance planning
equips you to smooth out the uncertainties and adversities that life might send
your way, so that the best that life has to offer, secure in the knowledge that
your beloved ones are well provided for.
BSLI offers a complete range of insurance products
21
5.3. MAJOR PLAYERS OF INDUSTRY :-
Fig No : 5
TOP 7 INSURANCE COMPANIES IN INDIA :-
Fig No : 6
22
6. LITERATURE REVIEW.
1. LIFE INSURANCE INDIA, (2009) AUTHOR WAS H. SADHAK :-

This book was wrote by H. Sadhak in 2009, in this book the
importance of life insurance and the role of life insurance in any individuals
life is given. this book says that the life insurance is an important and integral
component of macro economics and has emerged as a dominant institutional
player in financial market impacting the health of economy through the multi
dimensional role in savings and capital market. The primary role of life
insurance company is to provide insurance coverage for managing personal
financial risk.
this book explains why we need life insurance? when to tack it? and what are
the role of life insurance and its different products.
2. DECCAN CHRONICLE, (2019) AUTHOR IS SANGEETHA G. :-

Name of the article was ' INDIA IS 10TH LARGEST LIFE
INSURANCE MARKET ' in this article the stack of the life insurance sector
is given and the market share of life and non life insurance segments in the
global is told and many more, According to this article India is among the few
countries with high growth rate for life & non life insurance. In global
insurance market India has a share of 1.92% . In life insurance segment the
share is slightly higher at 2.6% , and country ranks 10th among 88 global
markets. according to the study by Swiss Re Finds. Global life insurance
premium are expected to grow in 2019-2020. this article talks about the
premiums of the life and non life insurance segments globally.
3. ENTREPRENEUR INDIA. (2020) AUTHOR IS BRIAN

GREENBERG. :-
Name of the article is ' HOW COVID-19 CAN AFFECT YOUR
LIFE INSURANCE COVER ' According to this article policy holders can
get claim even if he is a corona positive or he can apply for insurance even if
his reports are positive, but only the condition is client should not fail in
23
disclosure of his travelling history. If he traveled from the country where cases
of COVID-19 are huge then in that case company suspend their applications
for more than 30 days. and other things regarding the current situation of
COVID-19.
In short this article is about the impacts of COVID-19 on clients policies,
claims. and the innovative solutions of the company on it.
4. ECONOMIC TIMES (2020) :-

This article is about the growth of the life insurance sector in upcoming
few months. according to this article, The next few months for the Insurance
industry will be difficult in returning to the high speed market growth
highways they are used to for long, from this article it is clear that the
industry have to find some innovative solutions for this current situation of
COVID-19. This article also give information of life insurance sector in deep.
5. COLE REPORTS. (2020) AUTHOR IS PRSHANT. :-

This is a research report named ' UNIVERSAL LIFE
INSURANCE MARKET SWOT ANALYSIS.' This report is a perfect
combination of qualitative and quantitative information highlighting key
market developments, industry and companies upcoming challenges and new
opportunities doe to this current situation, trending in the market. this report
also give information about the life insurance market size, growth rate,
revenues of industry etc..
6. THE ECONOMIC TIMES WEALTH LIFE INSURANCE. (2019)

WRITER IS NAVNEET DUBEY. :-
The name of the article is ' IRDAI issues new norms to curb
life insurance misselling, makes illustrations mandatory'. In this article
information about IRDAI , Everything about IRDAI norms, and regulations
etc. for the interest of customers. IRDAI Is designed to safeguard and protect
the interest of the policy holder and to check that their rights are not violated
by any company. IRDAI is a regulatory body for all insurance sector. in this
article I got what are the role of IRDAI, new norms of the regulatory body
regarding the new situation etc.
24
7. WARD AND ZURBRUEGG . (2000).
I this article how insurance sector contributes towards country's
economic growth is explained very well Financial sectors of a country are
considered as a vital part of its economic growth. An effective and well
developed financial system helps to increase productivity and subsequently the
economic growth. Insurance is an important part in the financial sector that
contributes significantly to the economy of a country. Insurance market
contributes to the economic growth as an financial intermediary and also helps
in managing risk more effectively
8. SKIPPER, (2001) :-
In this article why insurance is important in individuals life is explained
according to this article, insurance contributes to the promotion of financial
stability, facilitation of trade and commerce, management of risk in an
effective manner, mobilization of savings, allocation of capital in an effective
way and also it acts as a complement of Government security programs.
Source: Google
25
7. RESEARCH METHADOLOGY.
This project measures the financial performance and the position

of the insurance companies with the help of the fundamental analysis of the
insurance as a whole sector as well as the companies selected, fundamental
analysis is done with the help of the financials and the annual reports of that
company available on their official websites. and also by using different tools
like ratio analysis for doing fundamental analysis.
I am using Secondary research tools for doing analysis i.e. annual
reports, articles, different websites etc..
Data used for the performing analysis is received from the genuine
source i.e. from the annual reports of last few years of the companies from
their official websites for all the companies.
I am considering Consolidated balance sheets and profit and loss
accounts for analysis. and for doing fundamental analysis tools which I am
using for are ratio analysis and the comparison of Valuations of the
companies and also the analysis related to the future growth of the sector.
26
8. FUNDAMENTAL ANALYSIS.
8.1. INTRODUCTION OF FUNDAMENTAL ANALYSIS :-

The basis of fundamental analysis is to determine the financial
stability and the future profitability of companies, and therefore their future
worth, which is extremely important as this future worth determines their
future share price. To put this simply, a company with its sales revenue and
profits increasing will be worth more than a company with declining sales
revenue and profits. Financial reports are provided by companies, typically on
a quarterly basis together with one final annual report.
These financial reports are accounting statements which provide a
means of tracking how much money a company is making and how much it is
spending. Stock market Analysts use these financial reports to forecast future
sales revenue and profits. While an individual stock investor can go through
the financial reports themselves, generally it is quicker and simpler to use
summarized data that is readily available from information websites. These
websites also usually provide forecast sales and profit data as well.
Fig No :- 7
27
8.2. COUNTRY (ECONOMIC) ANALYSIS :-
Fig No :- 8
FACTORS AFFECTING INSURANCE INDUSTRY.
Financial sectors of a country are considered as a vital part of its

economic growth. An effective and well developed financial system helps to
increase productivity and subsequently the economic growth. Insurance is an
important part in the financial sector that contributes significantly to the
economy of a country. Insurance market contributes to the economic growth
as an financial intermediary and also helps in managing risk more effectively
Moreover, insurance contributes to the promotion of financial
stability, facilitation of trade and commerce, management of risk in an
effective manner, mobilization of savings, allocation of capital in an effective
way and also it acts as a complement of Government security programs .
28
For last few years, it is observed that there has been a significant growth in the
insurance sector across the globe. The insurance industry in India is witnessing
a growth rate of 12-13% in the financial year 2015. Due to the changing life
style, work culture and high income structure, change in consumption types
and rate lots of change is currently happening in the insurance sector .
TOP 24 INDIAN LIFE INSURANCE COMPANIES.
Fig No : 9
29
ECONOMIC ASPECTS AFFECTING INSURANCE INDUSTRY
Fig No : 10
Economic aspects of affecting insurance industry includes the following

aspects like GDP, Inflation Rate, Interest Rates, and Employment rates are
explained below.
1. GDP (Gross Domestic product) :-
GDP is assumed as "the world's most powerful statistical indicator of
national development and progress. The most important and the fastest
growing sector of Indian economy are services. Trade, hotels, transport and
communication; financing, insurance, real estate and business services and
community, social and personal services account for more than 60 percent of
GDP. Agriculture, forestry and fishing constitute around 12 percent of the
output, but employs more than 50 percent of the labor force. Manufacturing
accounts for 15 percent of GDP, construction for another 8 percent and
mining, quarrying, electricity, gas and water supply for the remaining 5
percent.
30
GDP OF INDIA
Fig No : 11
High growth of GDP induces an economic effect through higher per-

capita and disposable income and savings, which in turn create a favorable
market demand for life insurance. On the other hand, life insurance also gives
support to the capital market and savings of Indian life insurance business.
Data pertaining to Indian life insurance and macroeconomic variables broadly
indicate a close relationship and interdependence between economic variables
and life insurance demand.
2. INFLATION RATE IN INDIA :-
Inflation is nothing but a sharp rise in prices. Inflation refers to an

overall increase in the Consumer Price Index (CPI), which is a weighted
average of prices for different goods. Annual inflation, refers to the percent
change of the CPI compared to the same month of the previous year.
31
INDIAN INFLATION RATE IN 2020
Fig No : 12
3. INTEREST RATES IN INDIA :-
In India, interest rate decisions are taken by the Reserve

Bank of India's Central Board of Directors. The official interest rate is the
benchmark repurchase rate. In 2014, the primary objective of the RBI
monetary policy became price stability, giving less importance to
government's borrowing, the stability of the rupee exchange rate and the need
to protect exports. In February 2015, the government and the central bank
agreed to set a consumer inflation target of 4 percent, with a band of plus or
minus 2 percentage points, from the financial year ending in March 2017.
32
RBI INTREST RATES.
Fig No : 13
The analysis indicated a strong correlation between

inflation and life insurance premium underwritten with a correlation
coefficient of 0.97 whereas interest rate has a negative correlation with life
insurance premium as expected with a correlation co-efficient of -0.507. It
can reliant from this analysis that when inflation rises, it reflects an increase
in life insurance premium amount for new business as the premium charged
should be adjusted under inflationary conditions.
Hence the new life insurance premiums have increased and it
is reflected in a strong positive correlation between inflation and life insurance
premium. A fall in interest rates would lead to an increase in life insurance
premium because people will invest huge amount and will take more number
of policies from LIC of India and other private life insurance companies when
compared to other financial savings. Since people will invest and save their
money in policies for yielding additional returns with life risk cover
33
4. EMPLOYMENT RATE :-
Insurance helps create both direct and indirect employment in the

economy. Alongside regular jobs in insurance, there is always demand for a
range of associated professionals such as brokers, insurance advisors, agents,
underwriters, claims managers and actuaries. The increasing insurance
business has increased the demand for highly skilled professionals as well as
semi-skilled and unskilled people. For example, life insurance provided direct
employment to an additional set of 30,912 people besides adding more than
4,07,768 individual agents during the financial year 2009 and 38,480 people
besides adding more than 5,03,666 individual agents during the financial year
2011.
To ensure continued growth, the need of the hour is trained manpower
with specialized knowledge about insurance. Insurance companies need to
invest in the professional training of their employees, especially for subjects
such as underwriting, claims and risk management.
EMPLOYMENT TO POPULATION RATIO.
Fig No : 14
34
5. WHY VIETNAM IS THE NEXT MANUFACTURING HUB?
We all know the current political , economic, and about the tents
relation among America, India Vs China, etc.. situations in the country ,
because of these things many big manufacturing companies like Samsung,
Apple are moving from China to Vietnam (India). why to Vietnam and not
anywhere else? it will get clear after going through below paragraph.
Vietnam’s emerge nce as a manufacturing hub is gathering
momentum. From the seven emerging Asian based countries for
manufacturing, Vietnam has emerged as number one, due to its low
manufacturing costs, skilled labor force, geo-political and economic stability.
In addition to the financial benefits, international companies have set up
manufacturing in Vietnam to offset their dependency and supply chain risk on
China, as a single resource.
some reasons of why Vietnam is the next manufacturing hub are :-
1. Easy to set up production unit as the place is bit near from china. also due to
good infrastructure.
2. Vietnam invests in healthcare and education therefore chance to get huge
human resource. high economic growth.
3. Vietnam Dong ( currency ) pegged to USD.
4. Low cost and procedure to start a new business or build a new
manufacturing plant. 'Ho Minh Chi' City can be a next manufacturing hub
from Vietnam.
5. Vietnam’s labor costs are among the lowest in Asia.
This are the reasons of why Vietnam can be a next manufacturing
hub. If this happens then, employment level will be increase in India and
unemployment will decreases and as there is a high employment rate in this
case people will have extra cash in their hands so that they can invest money
in private or public insurance companies comparing with bank rates. this can
prove as opportunity (growth ) as well a challenge (of Attracting peoples
towards them to invest) for insurance industry in India.
35
Fig No : 15
VIETNAM ADVANTAGES
36
8.3. SECTOR ANALYSIS :-
1. INSURANCE SECTOR ANALYSIS :-
The life insurance industry in India is regulated by the Insurance Regulatory

and Development Authority of India (IRDAI). Twenty four Life Insurance
companies are licensed to do Insurance Business in India. Out of these
companies, Life Insurance Corporation Of India (LIC of India) is the only
public sector company.
Here is a detailed analysis of the Indian Insurance Sector and which
companies should you look at.
2. KEY STATISTICS :-
Total Gross Premium Written for FY2018-19 was almost $100 Billion. Thus,
the valuation of total premiums write (Life insurance + Non-life insurance) in
India in FY2018-19 was around Rs.7 Lakh Crore.
If we compared it with Mutual Fund Industry, the total inflow in mutual fund
industry is normally around Rs.1-1.5 Lakh Crore (that to in a good year). So,
we can clearly get the growth potential of insurance sector in coming years.
Out of the total Rs.7 Lakh Crore premium in FY2018-19,
1. 75% : Life Insurance Companies’ premium (Rs.5.25 Lakh Crore)

2. 25% : Non-Life Insurance Companies’ premium (Rs.1.75 Lakh Crore)
37
INSURANCE INDUSTRY
Life Insurance Sector Non-Life Insurance Sector
25%
75%
Fig No : 16
source : self made chart
4. GROWTH OVER THE LAST FEW YEARS :-

The insurance sector continues to remain one of the fastest
growing markets with a Compound Annual Growth Rate (CAGR) OF 12%
TO 15% From FY. 2014 to FY. 2019 according to EY-ASSOCHAM report.
As of FY.2018, India is the 11th largest insurance market in the world has
bagged the 10th position in the Life Insurance segment in the terms of the total
premium. There are 24 Life Insurance and 33 Non-Life Insurance companies
in Indian insurance market currently competing on price and services to attract
the customers.
According to a report given by the Indian Brand Equity
Foundation (IBEF), The Indian insurance industry expected to grow Rs.
19,56,920 crore by FY2020, owing to the solid economic growth and higher
personal disposable incomes in country. the overall insurance penetration in
India touched 3.69% in 2017 from 2.71% in 2001.
In private sector, HDFC Standard Life Insurance is lending with
a share of 14.25% in new business premium, followed by SBI Life Insurance
at 9.15% and ICICI Prudential Life Insurance at 6.35%.
38
MAJOR SHARE IN MARKET.
18% 14%
9% HDFC Standard Life Insurance

SBI Life Insurance
6% ICICI Prudential Life Insurance
LIC
Others
53%
MAJOR STAKES HELD BY THE COMPANIES IN MARK

Fig No : 17
source : self made chart
39
5. PORTER'S FIVE FORCE MODEL :-
Fig No : 18
source : Google image
1. COMPETITIVE RIVALRY :- (HIGH)
Insurance has become more of a Commodity. The Insurance

companies with low cost structure, better customer service and greater
efficiency will be able to beat out its competitors. Considering that more than
50 companies exist in this sector, The intensity of competition would
definitely be high.
2. THREAT OF NEW ENTRANTS :- (HIGH)

The threat for new entrants lies within the industry itself. Some
companies are operating in the niche area of underwriting insurance. They are
40
running the threat of being squeeze out by big players. Another threat is other
financial services companies entering the market.
3. BARGAINING POWER OF SUPPLIERS :- (MEDIUM)

For the insurance industry, the source of funds is the premium
paid by its customers, hence intertwining the customer and suppliers here. The
suppliers of fund here, hence have the option of choosing from various
insurance agencies. however, the insurance agencies cannot reduce the
premiums below a minimum support level. Thereby, the bargaining power of
suppliers is medium.
4. THREAT OF SUBSTITUTES :- (LOW)

There is no real threat of substitutes for the insurance industry.
however, PPF and PF can act as low level of substitute.
5. BARGAINING POWER OF BUYER :- (MODERATE TO HIGH)

There are 2 types of buyer / consumers individual and corporate.
large corporate clients who pay millions of dollars in premium have a lot more
bargaining power than individual clients. the buyers have moderate to high
bargaining power as a whole
41
PESTEL ANALYSIS OF INSURANCE SECTOR.
Fig No : 19
source : Google images

Fig No : 20
42
8.4. COMPANY ANALYSIS. :-
While doing company analysis I am considering 3 companies of life insurance

sector. are as follows :-
HDFC Life Insurance Company Ltd. :- private company. (2000)
ICICI Prudential Life Insurance Company Ltd. :- private company. (2000)
SBI Life Insurance Company Ltd. :- private company. (2001)
8.4.1 HDFC LIFE INSURANCE COMPANY LTD. :-

( PRIVATE COMPANY , 2000)
8.4.1.1. About HDFC Life Insurance CO.LTD.
HDFC Life Insurance Co. Ltd. established in the year of 2000, As a

joint venture between Housing Development Finance Corporation Limited
(HDFC Ltd) and Standard Life Aberdeen. It was the first private company to
get a license from the Insurance Regulatory and Development Authority
India ( IRDAI ) in 2001.
HDFC Life Insurance co. ltd. is one of the leading private life
insurance company in India , which was providing 34 individual and 11
group insurance solutions, All Products Term P lans, Women's Plans,
Savings & Investment Plans, Health Plans, Children' Plans, Group Plans..
etc.
43
After a strong period of growth, the company completed its
initial public offer (IPO) in 2017. this company is Listed On The Stock
Exchange, Mumbai, . with a BSE Code of 540777. and National Stock
Exchange of India Ltd , with an NSE Code of HDFCLIFE.
The company has a good dividend track report and has
consistently declared dividends for the last 5 years. Dividend Type of the
company issuing is Interim Dividend, in 2017 dividend of Rs : 1.3600 per
share was allotted which is approx 13.6 %, and then in 2019 dividend
allotted was Rs : 1.6300 per share which is 16.3%.
LISTING INFORMATION OF HDFC LIFE INSURANCE COMPANY

LTD.
Market Cap (Rs Cr.) 110,913.17

Book Value (Rs) 33.65
Face Value (RS) 10.00
Price/Book (Rs) 16.32
Price/Equity 85.50
Table No 1
MANAGEMENT TEAM OF HDFC LIFE INSURANCE COMPANY

LIMITED
Name Designation
Deepak S Parekh Non Executive Chairman
Suresh Badami Whole Time Director
Renu Sud Karnad Non Executive Director

Bharti Gupta Ramola Independent Director
Ranjan Mathai Independent Director

Vish Viswanathan Independent Director
James Aird Alternate Director
44
Rushad Abadan Alternate Director
Vibha Padalkar Managing Director & CEO

Keki M Mistry Non Executive Director
Norman K Skeoch Non Executive Director
Ketan Dalal Independent Director
Sumit Bose Independent Director

Prasad Chandran Independent Director
Table No : 2
www.moneycontrol.com
This is the list of the managing peoples of the HDFC Life Insurance
Company Ltd. i.e. the Chairman, CEO ( Chief Executive Officer), Managing
director, , and the director body.
8.4.1.2.. SWOT Analysis of HDFC Life Insurance Co. Ltd.

SWOT Analysis is the analysis in which we came to know the
Strengths of the company, Weakness of the company, Opportunities for the
company and what are the Threats of the / to the company.
STRENGTHS of the Company :-
 Increasing Profit Margin year on year.

 Company with No Debt
 Strong cash generating ability from core business - Improving Cash Flow from
operation for last 2 years
 Annual Net Profits improving for last 2 years
 Book Value per share Improving for last 2 years
 Institutions increasing their shareholding
WEAKNESS of the Company :-
 Companies with growing costs year on year for long term projects
45
 Promoter holding decreased by more than -2% quarter on quarter
 Declining Net Cash Flow : Companies not able to generate net cash
 Major fall in TTM Net Profit
 Recent Results : Fall in Quarterly Revenue and Net Profit year on year
 Recent Results: Declining Operating Profit Margin and Net Profits year on
year
OPPORTUNITIES of Company :-
 Brokers upgraded recommendation or target price in the past three months
 Negative to Positive growth in Sales and Profit with Strong Price momentum
 RSI indicating price strength


THREAT of company :-
 Increasing Trend in Non-Core Income
 Stocks with high PE (PE > 40)
 Increase in Provisions in Recent Results
www.moneycontrol.com
SHAREHOLDINGS OF HDFC LIFE INSURANCE COMPANY.
YEARS PROMOTERS FII/FPI
Sep-18 80.84 8.42
Dec-18 80.71 8.23
Mar-19 76.14 10.52
Mar-20 63.69 21.07
Table No: 3
As I mentioned in SWOT Analysis that the share holding of promoters are

decreasing by approx 2% . and share holdings of FII/FPI is increasing. this are
the figures given on their website.
46
SHAREHOLDINGS OF HDFC LIFE
INSURANCE COMPANY LTD.
90
80
70
60
50
40
30
20
10
0
Apr-19
Sep-18
Feb-19
Sep-19
Feb-20
Mar-19
Mar-20
Dec-18
Jun-19
Dec-19
Jul-19
Aug-19
Oct-18
Oct-19
Nov-19
Nov-18
May-19
Jan-20
Jan-19
Sep-18 Dec-18 Mar-19 Mar-20

PROMOTERS 80.84 80.71 76.14 63.69
FII/FPI 8.42 8.23 10.52 21.07
Fig No : 21
source : self made
TOTAL SHAREHOLDINGS OF HDFC LIFE INSURANCE CO. LTD.
Promoters 63.69%
FII/FPI 21.07%
Total DII 8.51%
Others 6.73%
Table No: 4
47
SHAREHOLDINGS OF HDFC LIFE
INSURANCE COMPANY.
Total DII
8%
Others
7%
FII/FPI
21%
Promoters
64%
Fig No : 22
source : self made
8.4.1.3. FINANCIALS
Balance sheet is a financial statement of the company. analysis of balance

sheet can be defined as an analysis of the assets, liabilities, and equity of a
company. This analysis is conducted generally at set intervals of time, like
annually or quarterly. The process of balance sheet analysis is used for
deriving actual figures about the revenue, assets, and liabilities of the
company.
The balance sheet analysis is helpful for the investors, investment bankers,
share brokers, and financial institutions, for verifying the profitability of
investment for a specific company
48
TOTAL ASSETS OF HDFC LIFE INSURANCE COMPANY :-
TOTAL ASSETS
8,000.00
7,000.00
6,000.00
5,000.00
4,000.00
3,000.00
2,000.00
1,000.00
0.00
16-Mar 17-Mar 18-Mar 19-Mar 20-Mar
TOTAL ASSETS 3,103.49 3,826.31 4,735.27 5,642.60 6,806.62
Fig No : 23
source : self made
Assets are increasing year on year of the company. which means

company is investing the returns of the company more.
Formula :- Current Assets + Non-Current Assets = Total Assets
49
TOTAL LIABILITIES OF THE HDFC LIFE INSURANCE COMPANY
TOTAL LIABILITIES
8,000.00
7,000.00
6,000.00
5,000.00
4,000.00
3,000.00
2,000.00
1,000.00
0.00
16-Mar 17-Mar 18-Mar 19-Mar 20-Mar
TOTAL LIABILITIES 3,103.49 3,826.31 4,735.26 5,642.60 6,806.62
Fig No : 24
source : self made
Total liabilities of the company are also increasing , in 2017 liabilities are
increased by Rs. 722.82 in 2018 it increases by 908.95 , in 2019 it increases
almost with the same amount of 2018 and in 2020 liabilities of the company
increased by 1164.02 rupee Net worth and the total liabilities of the company
are exactly equal, that means company has no debts i.e. secured and unsecured
loans. that means the company is zero debt company which is a good thing.
Formula :- Current Liability + Non-Current Liability = Total Liability.
50
TOTAL NET WORTH OF HDFC LIFE INSURANCE COMPANY:-
NETWORTH
7,000.00
6,000.00
5,000.00
Axis Title
4,000.00
3,000.00
2,000.00
1,000.00
0.00
Mar-16 Mar-17 Mar-18 Mar-19 Mar-20
NETWORTH 3,103.49 3,826.31 4,735.26 5,642.60 6,806.62
Fig No : 25
source : self made
As we can see in the graph that the Total Net worth of the company is
increasing year on year may be because of the changes in the assets and
liabilities of the company and the returns of the company . the net worth
means Assets of the company exceeds liabilities of the company.
Formula :- Share capital + Equity share capital + Reserve = Net Worth.
51
RATIOS ANALYSIS OF COMPANY :-
Financials of co. Mar-20 Mar-19 Mar-18 Mar-17 Mar-16
Sales 1,667.84 1,645.50 1,296.53 1,016.64 889.46

Total Expenditure 373.78 375.92 184.78 107.79 66.65
EBITDA 1,313.92 1,291.29 1,125.13 908.93 833.38
depreciation. 0 0.27 0.19 0 0
EBIT 1,313.92 1,291.02 1,124.94 908.93 833.38
Interest 0 0 0 0 0
EBT 1,313.92 1,291.02 1,124.94 908.93 833.38
Tax 16.47 13.09 17.74 22.01 16.59
EAT 1,297.45 1,277.93 1,107.20 886.92 816.79
EPS (Rs.) 6.43 6.34 5.52 4.44 4.09
RATIOS Mar-2020 Mar-2019 Mar-2018 Mar-2017 Mar-2016

debt / equity 0 0 0 0 0
Current Ratio (times) 0.87 3.09 3 15.92 20.25
Return On Assets (%) 0.98 0.98 1 0.93 1.06
ROCE (%) 1.03 1.03 1.06 0.99 1.12
Return on Net worth / 19.07 22.64 23.38 23.17 26.31
Equity (%)
Gross Profit Margin (%) 78.77 78.47 86.78 89.4 93.69

Operating Margin (%) 78.77 78.45 86.76 89.4 93.69
Net Profit Margin (%) 77.79 77.66 85.39 87.24 91.82
book value 33.69 27.97 23.53 19.15 15.55
Enterprise Value (EV) 88,470.34 75,118.06 90,123.93 0 0
(Cr.)
EV/EBITDA (times) 67.45 58.22 79.99 0 0
Table No : 5
Source : Dion Global Solutions Limited
INTERPRETATION OF FINANCIALS AND RATIOS :-
EV is a enterprise value of company. it shows the value of the company in

the market. Enterprise Value of HDFC life insurance company is high. again
which add more value to companies valuation.
Equity to Debt Ratio shows the relation between the equities and debt,
HDFC life insurance is a zero debt company, and lower ratio generally
considered better as it shows the companies ability to pay off the companies
debts with its own capital. and the debt equity ratio for the company is lowest
52
which means company have that ability to pay off the debts of the company
with its own capital.
Current Ratio shows the relation in between the current assets and current
liability it helps to know the liquidity of the company. The current ratio
provides us with a rough estimate that whether the company would be able to
“survive” or not. the ratio should be greater than 1 , current ratio for FY 2020
is less than 1 which means in year 2020 company have more current liabilities
than current assets.
Return On Asset and Return On Equity is the ratios, through which we can
understand the how company utilizes the resources. Higher Return on Equity
implies a higher return to the Stakeholders. and Return on Assets relates to
the firm’s earnings to all capital invested in the business. In this HDFC life
insurance company return on asset ratio is less than 1 for FY:2020,2019,2017
and 2016 as well. but return on equity ratio is higher. that shows the
shareholders are getting more returns.
ROCE ratio means return on capital employed which measures companies
profitability and efficiency with which its capital is used. and the returns are
more than 1 from FY :2016 which means company using capital in efficient
way.
53
PROFITABILITY RATIOS OF HDFC LIFE
INSURANCE CO.
100
90
80
70
60
50
%
40
30
20
10
0
Fig No : 26
source : self made
Formula :-
1. Operating profit margin :- Operating Income / Total Revenue. *100
2. Gross Profit Margin Ratio :- Gross Profit / Revenues.*100
3. Net Profit Margin Ratio :- Net profit / Revenues.*100
Operating profit measures the rate of profit on sales after operating expenses
Net Margin is basically the net effect of operating as well as financing
decisions taken by the company.
Gross Profit Margin and Net Profit Margin are profitability ratios used
to assess the financial condition of the company. Both Gross and Net Profit
Margin are expressed in percentage terms to measure t he profitability of the
company as compared to the revenues for the period. Gross Profit Margin is
above 75% of the company which is a good profits.. which can also means that
the company is company is successfully producing profits over and above its
costs. Net Profit Margin is high i.e. 77.79% in 2020 that means company
generates more profits from its sales.
According to me HDFC life insurance is a good company to invest in.
54
8.4.2. ICICI PRUDENTIAL LIFE INSURANCE COMPANY LTD.
( PRIVATE COMPANY , 2000)
8.4. 2.1. About ICICI Prudential Life Insurance Company Ltd. :-
ICICI Prudential life insurance company limited founded in 2000,

its headquarter is in Mumbai. it started its operations in fiscal year 2001,
providing long term savings and protection products to meet the requirements
of the customers it also provides cost effective products, superior quality
services, consistent fund performance and a hassle free claim settleme nt
experience to customers.
From 2012 company started paying dividends, For the year ending
March 2020 ICICI Prudential Life Insurance Company has declared an
equity dividend of 8.00% amounting to Rs 0.8 per share. At the current
share price of Rs 425.40 this results in a dividend yield of 0.19%. The
company has a good dividend track report and has consistently declared
dividends for the last 5 years.
ICICI Prudential is in the Finance - Life Insurance sector. ICICI
prudential life insurance is a first insurance company in India to be listed
on NSC And BSE, It is listed on the BSE with a BSE Code of 540133 and
the NSE with an NSE Code of ICICIPRULI. In FY2015 ICICI Prudential
Life Insurance becomes the 1st private life insurance company who attain
AUM (Asset Under Management) of Rs. 1 Trillion.
55
LISTING INFORMATION OF ICICI PRUDENTIAL LIFE
INSURANCE COMPANY
Marketing Capital 61,074.86
Book value 50.23
Face value 10
Price / Book 8.47
Price / Equity 57.25
Table No:- 6
MANAGEMENT TEAM OF THE ICICI PRUDENTIAL LICE

INSURANCE COMPANY.
Name Designation
M S Ramachandran Chairman & Ind.Director
Puneet Nanda Deputy Managing Director
Sandeep Batra Director
Dilip Karnik Independent Director
Dileep Choksi Independent Director
N S Kannan Managing Director & CEO
Anup Bagchi Director
Raghunath Hariharan Director
R K Nair Independent Director
Vibha Paul Rishi Independent Director
Table No : 7
56
8.4.2.2 SWOT ANALYSIS OF ICICI PRUDENTIAL LICE
INSURANCE COMPANY.
STRENGTHS OF COMPANY :-
 Strong cash generating ability from core business - Improving Cash Flow from
operation for last 2 years
 Book Value per share Improving for last 2 years
 Institutions increasing their shareholding
WEAKNESS OF COMPANY :-
 Big Deal (Insider and SAST) sells last month greater than 1% of total shares
 MFs decreased their shareholding last quarter
OPPORTUNITIES OF COMPANY :-
 Brokers upgraded recommendation or target price in the past three months
 RSI indicating price strength
THREAT OF COMPANY :-
 Recent broker downgrade in target price
 Stocks with high PE (PE > 40)
 consistently decrease in profit margins of the company.
source : www.moneymarlet.com
SHAREHOLDINGS OF A ICICI PRUDENTIAL LICE

INSURANCE COMPANY.
SHAREHOLDING %
Promoters 74.98%
FII/FPI 13.34%
Total DII 8.88%
Others 2.80%
Table No : 8
57
SHAREHOLDINGS OF ICICI PRUDENTIAL LIFE
INSURSNCE COMPANY
Others
Total DII 3%
FII/FPI
9%
13%
Promoters
75%
Fig No : 27
source : self made
8.4.2.3. FINANCIALS AND VALUATION RATIOS :-
Balance sheet and profit and loss account analysis is about

studding these four to five factors of the company i.e. total assets, total
liability, net worth of the company, total revenues and total expenses which
company occur during the business operations. by analyzing these things we
will get an idea about the company's financial condition., whether it is earning
profits or losses.
58
TOTAL ASSETS OF ICICI PRUDENTIAL LIFE INSURANCE
COMPANY :-
TOTAL ASSETS
9,000.00
8,000.00
7,000.00
6,000.00
5,000.00
4,000.00
3,000.00
2,000.00
1,000.00
0.00
TOTAL ASSETS 5,323.34 6,394.24 6,860.27 8,889.86 7,212.47
Fig No 28
source : self made
As we can see in this graph clearly that the assets of the company are
increasing year on year but in 2020 it come down by approx 1,677. even
though the company is in positive and it is amongst the top companies of life
insurance sector.
Formula :- Current Assets + Non-Current Assets = Total Asset
59
TOTAL LIABILITY OF ICICI PRUDENTIAL LICE INSURANCE
COMPANY.
TOTAL LIABILITIES
9,000.00
8,000.00
7,000.00
6,000.00
5,000.00
4,000.00
3,000.00
2,000.00
1,000.00
0.00
TOTAL LABILITY 5,323.34 6,394.25 6,860.28 8,889.86 7,212.47
Fig No 29
source : self made
Total Assets and the Liabilities of ICICI Prudential Life Insurance company
are exactly equal that means the company has equal liability and investment
on the company.
60
TOTAL NET WORTH OF ICICI PRUDENTIAL LICE
INSURANCE COMPANY.
NETWORTH
7,000.00
6,000.00
5,000.00
4,000.00
3,000.00
2,000.00
1,000.00
0.00
NETWORTH 3,103.49 3,826.31 4,735.26 5,642.60 6,806.62
Fig No 30
source : self made
Net worth of the ICICI Prudential Life Insurance Company is continuously

increasing that means the share capital, Equity Share Capital and Reserves are
increasing year on year. and that is the one of the reason company is amongst
top companies.
Share capital + Equity share capital + Reserve = Net Worth
61
TOTAL REVENUE AND EXPENCES OF ICICI PRUDENTIAL LIFE
INSURANCE COMPANY
TOTAL REVENUE
3,000.00
2,500.00
2,000.00
1,500.00
1,000.00
500.00
0.00
TOTAL REVENUE 1,809.58 1,827.15 1,836.15 1,730.65 2,652.51
Fig No 31
TOTAL EXPENCES
1600
1400
1200
1000
800
600
400
200
0
TOTAL EXPENCES 38.23 42.73 117.25 569.41 1,585.53
Fig No: 32
source : self made
The total Revenues and Expenses if we compare, revenues are high than the
expenses of the firm. revenues are almost double than the expense. total
revenues are huge that means company has enough money in hand as well to
invest.
62
FINANCIALS AND RATIO ANALYSIS :-
FINANCIALS Mar-20 Mar-19 Mar-18 Mar-17 Mar-16

Sales 2,651.56 1,721.34 1,831.12 1,798.52 1,809.53
Total Expenditure 1,585.53 569.28 117.08 42.63 38.23
EBITDA 1,066.98 1,161.24 1,719.09 1,784.56 1,771.35
depreciation. 0 0 0 0 0
EBIT 1,066.98 1,161.38 1,719.07 1,784.52 1,771.36
Interest 0 0.13 0.17 0.1 0
EBT 1,066.98 1,161.25 1,718.90 1,784.51 1,771.36
Tax 0 22.32 99.73 102.76 121.21
EAT 1,066.98 1,138.93 1,619.17 1,681.66 1,650.15
EPS (Rs.)
7.43 7.93 11.28 11.72 11.52
IMPORTANT RATIOS FOR

VALUATION Mar-20 Mar-19 Mar-18 Mar-17 Mar-16
Debt / Equity 0.0 0.0 0.0 0.0 0.0

Dividend / share 0.8 3.15 7.8 5.25 8.4
Current Ratio (X) 1.15 0.91 0.79 1.01 0.67
Return On Assets (%) 0.68 0.69 1.14 1.34 1.57
ROCE (%) 0.69 0.72 1.17 1.37 1.6
Return on Net worth / Equity (%) 14.79 16.22 23.6 26.29 30.99

price to sales. (P/S) 19.26 29.15 30.57 30.51 0

book value 50.23 48.89 47.79 44.55 37.17
Enterprise Value (EV) (Cr.) 50,261.62 49,519.63 55,773.46 54,652.41 0
EV/EBITDA (times) 47.11 42.64 32.44 30.62 0
Table No : 9
63
INTERPRETATION OF FINANCIALS AND RATIOS :-
EV is a value of enterprise. enterprise value of company. it shows the value

of the company in the market.
Equity to Debt Ratio shows the relation between the equities and debt, ICICI
Prudential life insurance is a zero debt company, and lower ratio generally
considered better as it shows the companies ability to pay off the companies
debts with its own capital.
Dividend per share ratio shows the how much dividend is given per share to
the shareholders.
“survive” or not. the ratio should be greater than 1
the firm’s earnings to all capital invested in the business.
profitability and efficiency with which its capital is used
This is the short summery of all the ratios and for what reason they are
calculated.
64
profitability Ratios of ICICI Prudential life
insurance Company
100
80
60
%
40
20
0
Fig No : 33
source : self made
The profitability ratios like Gross, Operating and Net Profit Margin
Ratios are constraint for the FY 16 and FY 17 then there is increase in the
ratios by approx 1.5% but after FY18 there is a great fall in the profits by
approx 26 % and again in FY20 again fall by 27% to 28% these fig. clearly
says that, the company is earning huge losses year on year, and the reason
behind this is the returning ratios of the company are lower. that means
company is investing the huge amounts in the market but not get the returns as
company's investment decision are going wrong that's what I feel personally
after looking the financial statements and the rate of the returns and
profitability of the company. According to me the shares of these company is
facing huge losses because of their decisions like where to invest and at what
time to invest are may going wrong, and on the top of it COVID-19 situation.
65
8.4.3. SBI LIFE INSURANCE COMPANY LTD. :-
( PRIVATE COMPANY. 2001)
8.4.3.1. ABOUT SBI LIFE INSURANCE COMPANY LTD.:-
The company launched its business in 2001, SBI Life Insurance

Company is a joint venture between State Bank of India with 75% and BNP
Paribas Assurance with 26 % SBI Life Insurance is now among the top life
insurance providers in India. SBI Life extensively leverages the State Bank
Group relationship as a platform for cross-selling insurance products along
with its numerous banking product packages such as housing loans and
personal loans.
It is listed on the BSE with a BSE Code of 540719 and the

NSE with an NSE Code of SBILIFE . The company has a good dividend
track report and has consistently declared dividends for the last 5 years. This
company gives Interim dividend. in 2018. 20% and in 2019 again 20%
dividend allotted by the company.
. It is the largest private life insurer and was the 1st private life
insurance company to become profitable.
66
LISTING INFORMATION OF SBI LIFE INSURANCE
COMPANY
Market Cap (Rs Cr.) 83103.32

Book Value (Rs) 87.43
Price/Book (Rs) 9.5
Face Value (RS) 10
Price/Equity 58.47
Table No : 10
MANAGEMENT TEAM OF THE SBI LIFE INSURANCE

COMPANY
Name Designation
Rajnish Kumar Chairman
Dinesh Khara Director
Nilesh Vikamsey Independent Director
Raj Narain Bhardwaj Independent Director
Deepak Amin Independent Director
Sanjeev Nautiyal Managing Director & CEO
P K Gupta Director
Ravi Rambabu Independent Director
Joji Sekhon Gill Independent Director
Somasekhar Sundaresan Independent Director
Table No :11
67
8.4.3.2. SWOT ANALYSIS OF THE SBI LIFE INSURANCE
COMPANY
STREANGTH OF COMPANY :-
 Improving cash flows for last 2 years.
 Improving annual profit for last 2 years.

 Book value per share is also improving from last 2 years.
WEAKNESS OF THE COMPANY :-

 Fall in a TTM Profits
 Company is not able to generate net cash.
OPPORTUNITY OF COMPANY :-
 RSI Indicating price strength
 Brokers upgraded target price in the past 3 months.
THREATS OF COMPANY:-
 Breakers downgrades in target price.
 Insiders sold stocks.
source : www.moneymarlet.com
68
SHAREHOLDINGS OF SBI LIFE INSURANCE COMPANY
Promoters 62.8%
FII/FPI 25.87%
Total DII 9.05%
Others 2.27%
Total 100%
Table No : 12
SHAREHOLDINGS OF SBI LIFE INSURANCE

COMPANY
Others
2%
Total DII
9%
FII/FPI
26%
Promoters
63%
Fig No : 34
source : self made
69
8.4.3.3. FINANCIALS AND RATIOS :-
Balance sheet and profit and loss account analysis is

about studding these four to five factors of the company i.e. total assets, total
liability, net worth of the company, total revenues and total expenses which
company occur during the business operations. by analyzing these things we
will get an idea about the company's financial condition., whether it is earning
profits or losses.
TOTAL ASSETS OF SBI LIFE INSURANCE COMPANY
Total Assets of SBI life isurance companhy
180000.00
160000.00
140000.00
120000.00
Rs. in Cr.
100000.00
80000.00
60000.00
40000.00
20000.00
0.00
Total Assets 83429.07 102239.56 121720.44 146733.85 165580.19
Fig No : 35
source : self made
Total asset of SBI life insurance company is increasing year on year by

approx 10% to 20%. graph shows there is a consistent increasing in total
assets of the company.
Formula :- Current Assets + Non-Current Assets = Total Asset
TOTAL LIABILITIES OF SBI LIFE INSURANCE COMPANY
70
Total Liabilities of SBI life insurance company
180,000.00
160,000.00
140,000.00
120,000.00
Rs. in Cr.
100,000.00
80,000.00
60,000.00
40,000.00
20,000.00
0.00
Total Liabilities 83,429.07 102,239.56 121,720.44 146,733.85 165,580.19
Fig No : 36 source : self made

Total assets and total liabilities of SBI life insurance company are equal.
TOTAL INCOM OF SBI LIFE INSURANCE COMPANY
Total Income of SBI life insurance company
2000
1800
1600
1400
1200
Rs. in Cr.
1000
800
600
400
200
0
Total Income 977.44 1,064.33 1,292.93 1,517.70 1,946.14
Fig No : 37 source : self made
71
TOTAL EXPENDITURE OF SBI LIFE INSURANCE
COMPANY
Total Expenditure of SBI life insurance

company
600
500
400
Rs. in Cr.
300
200
100
0
Fig No : 38
source : self made
Total revenues are more than Total expenditures revenues are higher than the
expenses of the firm. revenues are almost double than the expense. total
revenues are huge that means company has enough money in hand as well to
invest, which means, the Company is representing the company is earning
profits.
72
NET WORTH OF SBI LIFE INSURANCE COMPANY
NET WORTH
18,000.00
16,000.00
14,000.00
12,000.00
10,000.00
8,000.00
6,000.00
4,000.00
2,000.00
0.00
NET WORTH 9,466.20 10,929.56 13,055.64 15,152.72 17,486.16
Fig No : 39
source : self made
As we can see in the graph of company's net worth, net worth of the company
is increasing year on year by approx 15% in FY 2020 than 2019, even the
company's net worth is continuously increasing from FY 2016 till 2020 by
approx 10% to 15% year on year. which can be interpret as the shareholders
funds, total share capital and reserves and surplus are increasing and that is
why the net worth is also increasing.
Formula :- Share capital + Equity share capital + Reserve = Net Worth
73
FINANCIALS AND RATIO ANALYSIS :-
FINANCIALS Mar-20 Mar-19 Mar-18 Mar-19 Mar-16

Sales (Rs) 1,939.35 1,504.16 1,281.47 1,056.12 969.51
Total Expenditure (Rs) 532.6 144.83 108.47 89.76 122.34
EBITDA (Rs) 1,413.54 1,373.49 1,184.77 974.89 855.39
depreciation. (Rs) 0 0.62 0.3 0.32 0.29
EBIT (Rs) 1,413.54 1,372.87 1,184.46 974.57 855.1
Interest (Rs) 0 0 0 0 0
EBT (Rs) 1,413.54 1,372.87 1,184.46 974.57 855.1
Tax (Rs) -8.63 46.07 34.07 19.92 11
EAT (Rs) 1,422.17 1,326.80 1,150.39 954.65 844.1
EPS (Rs.) 14.22 13.27 11.5 9.55 8.44
IMPORTANT RATIOS FOR

VALUATION Mar-20 Mar-19 Mar-18 Mar-19 Mar-16
debt / equity (--:1) 0 0 0 0 0
Dividend / share 0 2 2 1.5 1.2
Current Ratio (times) 22.59 1.78 1.83 17.76 15.17

Return On Assets (%) 0.85 0.9 0.94 0.93 1.01
ROCE (%) 0.87 0.96 1 0.98 1.05
Return on Net worth / Equity (%) 16.26 17.51 17.62 17.46 17.83

price to sales 33.05 38.53 52.56 0 0

87.43 75.76 65.28 54.65 47.33
book value
Enterprise Value (EV) (Cr.)
62,673.69 55,534.37 64,700.37 0.00 0
EV/EBITDA (times) 44.34 40.43 54.61 0 0
Table No : 13
Source : DionGlobalSolutions Limited
74
INTERPRETATION ON VALUATION RATIOS.:-
EV is a value of enterprise. enterprise value of company. it shows the value

of the company in the market,. and the EV of SBI life insurance company is
high.
Equity to Debt Ratio shows the relation between the equities and debt, SBI
life insurance is a zero debt company, and lower ratio generally considered
better as it shows the companies ability to pay off the companies debts with its
own capital.
Dividend per share ratio shows the how much dividend is given per share to
the shareholders.
“survive” or not. the ratio should be greater than 1 year., SBI life insurance
company's Current ratio is high.
the firm’s earnings to all capital invested in the business. Return on Assets are
less, but Return On Equity is higher, which also means the shareholders are
going to be receive more returns.
profitability and efficiency with which its capital is used, Return On Capital
Equity are also less. that means the capital is not efficiently invested or used.
This is the short summery of all the ratios and for what reason they are
calculated.
75
Profitability of SBI life insurance company.
100
90
80
70
60
50
%
40
30
20
10
0
Fig No : 40
source : self made
Gross , Operating , and Net profit margin are increasing from FY 2016 to FY
2019, but in FY 2020 these 3 ratios of profitability are fall by approx by 15%
to 20%. which is a huge number. it may be because of the COVID-19 or
because of the decreased interest rates in FY2020.
76
9 FINDINGS AND SUGGESIONS :-
9.1. VALUATION OF HDFC LIFE, SBI LIFE AND ICICI

PRUDENTIAL LIFE INSURANCE COMPANY. :-
COMPANY VALUATION :-
For doing valuations of life insurance company there are 3 different
components used that are :-
1. EMBEDDED VALUE (EV).
2. VALUE OF NEW BUSINESS (VNB).
3. NEW BUSINESS MARGIN (NBM).
1. EMBEDDED VALUE (EV) :-
EV helps investors to value a life insurance company. It gives an

idea of the quality of the services provided by the business. EV does not
consider the future policy sales by the company. EV is calculated by doing
sum of net asset value and present value of future profits of a life insurance
company. Higher EV shows the company's ability to earn profits even if
company shut down on the date. EV is expressed in Times, and the Indian
companies are trading on higher times.
According to the annual report of the SBI Life Insurance Company Ltd. -
Indian Embedded Value of the Company stands at 16,538 Cr. in FY 2017 ,
Rs. 19,070 Cr. FY 2018, Rs. 22,402 Cr., FY 2019, Rs. 24,690 Cr in FY
2020 (half financial year)
According to the annual report of HDFC Life Insurance company Ltd :-

Indian Embedded Value of the Company stands at Rs.12,471 Cr in FY.
2017, Rs. 15,216 Cr. in FY 2018, Rs.18,301 Cr in FY 2019. Rs. 20,120 Cr
in FY 2020 (half financial year)
77
According to the annual report of ICICI Prudential Life Insurance
company Ltd :-
Indian Embedded Value of the Company stands at Rs.16,184 Cr in FY.
2017, Rs. 18,788 Cr. in FY 2018, Rs. 21623 Cr in FY 2019. Rs. 22,680 Cr
in FY 2020 (half financial year)
EV MULTIPLES :- Market Capital / Embedded Value
2. VALUE OF NEW BUSINESS (VNB) :-
According to the annual reports of SBI Life Insurance Company Ltd. -

value of new business of the Company stands at 1,037 Cr. in FY 2017 , Rs.
1,385 Cr. FY 2018, Rs. 1,719 Cr., FY 2019. Rs. 850 Cr. in FY 2020 (half
financial year)
According to the annual reports of HDFC Life Insurance Company Ltd. -

value of new business of the Company stands at 920 Cr. in FY 2017 , Rs.
1,280 Cr. FY 2018, Rs. 1,540 Cr., FY 2019, Rs. 960 Cr. in FY 2020 (half
financial year)
According to the annual reports of ICICI Prudential Life Insurance

Company Ltd. -
value of new business of the Company stands at 666 Cr. in FY 2017 , Rs.
1,286Cr. FY 2018, Rs. 1,328 Cr., FY 2019, Rs. 709 Cr. in FY 2020 (half
financial year
78
3. NEW BUSINESS MARGIN (NBM) :-
According to the annual report of the SBI Life Insurance Company Ltd. -
. value of new business margin is 15.4 % in FY 2017, 16.2% in FY 2018,
17.7% in FY 2019, 18.1 % in FY 2020 (half financial year)
According to the annual reports of HDFC Life Insurance Company Ltd. -

value of new business margin is 22% in FY 2017, 23.2% in FY 2018,
24.6% in FY 2019, 27.5 % in FY 2020 (half financial year)
According to the annual reports of ICICI Prudential Life Insurance

Company Ltd. -
Value of new business margin is 10.1% in FY 2017, 16.5% in FY 2018, 17
% in FY 2019, 21.0 % in FY 2020 (half financial year)
Source: moneycontrol.com
(annual reports of
HDFC life
SBI life
ICICI prudential life
insurance company)
79
9.2. COMPANY's GROETH COMPARISION AND
INTERPRETATION
Life Insurance is a long term business, so it is important to see how the

company will earn in future , to know that the growth rate of the EV, VNB &
NBM , helps the investors to tack a decision on whether to invest in co. or not.
HDFC LIFE INSURANCE COMPANY
Embedded value is growing by 22% in FY 2018 and in FY 2019again

growing by 20% and till half FY 2020 it is growing by 22.8% that means the
company's EV is growing by approx 22% year on year. which shows company
is earning more and more profits.
Value of new business is growing. In FY 2018 it grows by almost 39%
but in FY 2019 it grows by only 20% and again in FY 2020 it is growing on
approx by 57% which is a huge number. VNB calculates profit for the present
year.
New business margins of HDFC life insurance company are showing
growth by approx 23% to 28% from FY 2017 till half FY 2020 consistently. if
company will grow at 21% for the next 10 year then the embedded value
multiple of the company will be 6.6 times. which is huge.
According to me on the basis of EV, VNB AND, NBM. HDFC life
insurance company is on number one . very good going and profitable it invest
in.
SBI LIFE INSURANCE COMPANY

growing by 17% and till half FY 2020 it is growing by 24% that means the
company's EV is growing by 15%, 17%,and 24% year on year. which shows
company is earning profits.
80
Value of new business is growing. In FY 2018 it grows by almost 34%
but in FY 2019 it grows by only 24% and again in FY 2020 it is growing on
approx by 33% , SBI life insurance company is earning less profits compared
to HDFC life insurance company. .
New business margins of SBI life insurance company are showing growth
by approx 15% to 18% from FY 2017 till half FY 2020 consistently. if
company will grow consistently on the same growth for the next 10 year then
the embedded value multiple of the company will be 4 times. which is huge.

insurance company is on number two i.e. after HDFC life insurance company
SBI life insurance company is good to invest in.
ICICI PRUDENTIAL LIFE INSURANCE COMPANY

growing by 15% and till half FY 2020 it is growing by 17.5% that means the
company's EV is growing by 16%, 15%,and 17.5% year on year. which
shows company is earning less profits compared to the HDFC and SBI life
insurance companies.
Value of new business is growing. In FY 2018 it grows on a very high

rate i.e. by 93 % but in FY 2019 it grows at only 3 % , and in FY 2020 it
grows at 17.80% which is showing very less growth than the HDFC and SBI
life insurance companies. they are growing on 57% and 33 %.
New business margins of ICICI prudential life insurance company

are showing growth by approx 10.1% , 16.5%,17% and 21% from FY 2017
till half FY 2020 respectively. if company will grow consistently on the same
growth for the next 10 year then the embedded value multiple of the company
will be only 3 times. which is very low compared to the HDFC and SBI life
81
insurance company is on number three i.e. after HDFC life insurance
company and SBI life insurance company, ICICI prudential life insurance
company is good to invest in.
COMPARATIVE GROWTH OF HDFC,SBI AND ICICI

PRUDENTIAL LIFE INSURANCE COMPANY.
HALF HALF MARKET EV.
COMPANY FY 17 GROWTH FY 18 GROWTH FY 19 GROWTH
FY 19 FY 20 CAP. MULTIPLE
(for
HDFC LIFE calculat e MARKET CAP
INSURANCE CO. growth / EV
of 1 yr.)
EV 12,471 22% 15,216 20% 18,301 16,380 22.80% 20,120 1,26,000 Cr 6.26 Times
VNB 920 39% 1,280 20% 1,540 610 57.00% 960
NBM 22.00% 23.20% 24.60% 24.31% 27.50%

(for
SBI LIFE calculat e MARKET CAP
of 1 yr.)
EV 16,538 15% 19,070 17% 22,402 19,910 24% 24,690 98,300 Cr 3.98 Times
VNB 1,037 34% 1,385 24% 1,719 640 33% 850
NBM 15.90% 16.20% 17.70% 17.30% 18.10%

(for
ICICI LIFE calculat e MARKET CAP
of 1 yr.)
EV 16,184 16% 18,788 15% 21,623 19,248 17.80% 22,680 68,500 Cr 3.02 Times
VNB 666 93% 1286 3% 1328 590 20% 709
NBV 10.10% 16.50% 17.00% 17.50% 21.00%
Table No 14
source : self made
82
10. CONCLUSION AND LIMITATIONS :-
CONCLUSION :-
Firms involved in investment activities required equity research. e.g.

Insurance companies, Pension fund companies, Asset management firms..etc.
such companies invest in equity market heavily, with the aim of earn more
returns for their clients. therefore it is very important for them to conduct in
depth analysis of a particular sector before putting clients money into it.
Equity research analysis report do SWOT analysis of the company
using its financial data and present them in detailed analysis
In this report I did sector analysis which results that life insurance
sector is a long term business and for current situation It may reflects some
decrease in the profitability due to the COVID-19 pandemic situation. but in
long term that means in future life insurance sector will be the one of the
growing sectors.
I did company analysis of 3 life insurance companies which are
HDFC life insurance company , SBI life insurance company and ICICI
prudential life insurance company, and did the valuation based on the
Embedded Value, Value of New Business. and New Business Margin. of the
companies.
The main measures of to do valuation of any life insurance
company. and the results are HDFC life insurance company is the company
which shows the highest returns i.e. the embedded value multiple is 6.3 times
in current situation and with the consistent growth rate since FY 2017 to half
FY 2020 at the rate of 20%. therefore the HDFC life insurance company is the
no. 1 company in life insurance sector.
On 2nd no. SBI life insurance company is earning returns . which
means the embedded value of SBI life is showing returns approx 4 times, plus
the growth rate is lower than the HDFC life insurance company.
On 3rd no. ICICI prudential life insurance company is valued. ICICI
prudential life insurance company's embedded value is only 3 times. and the
83
growth rate of EV, VNB & NBM are lower than the HDFC life and SBI life
On the basis of the valuations I will suggest clients to invest more I
HDFC life insurance company more, which can give investors more returns
compared to other two companies in life insurance sector.
Equity research analysis only provide advice on the best stock
to invest in and he should buy , sell or hold shares of which company.
it's not obligatory that investor should follow the same.
LIMITATIONS TO PROJECT REPORT :-
 Only 3 companies are listed in life insurance sector. that are

HDFC Life Insurance Company Ltd.
SBI Life Insurance Company Ltd.
ICICI Prudential Life Insurance Company Ltd.
 Very limited range to do equity research analysis.
 Only Fundamenta l Analysis . i.e. Financials Ratio Analysis and Valuation of

company shares.
84
ANNEXURE
This report has gathered the data for doing the fundamental analysis of the life
insurance sector and the valuation of the life insurance companies
I did the company analysis which includes the financials and the valuations of
the company for that I selected 3 companies namely:-
HDFC Life Insurance Company Ltd.

SBI Life Insurance Company Ltd.
ICICI Prudential Life Insurance Company Ltd.
HDFC LIFE INSURANCE COMPANY LTD.
INCOME STATEMENT OF HDFC LIFE INSURANCE CO.
Particulars Mar-20 Mar-19 Mar-18 Mar-17 Mar-16

Sales 1,667.84 1,645.50 1,296.53 1,016.64 889.46
Other Income 19.86 21.44 13.19 0.08 10.57
Total Income 1,687.70 1,666.94 1,309.72 1,016.72 900.03
EBIT 1,313.92 1,291.02 1,124.94 908.93 833.38
Interest 0 0 0 0 0
Tax 16.47 13.09 17.74 22.01 16.59
Net Profit 1,297.45 1,277.93 1,107.20 886.92 816.79
85
BALANCE SHEET OF HDFC LIFE INSIRANCE CO.
Equities & Liabilities Mar-20 Mar-19 Mar-18 Mar-17 Mar-16

Share Capital 2,018.80 2,017.38 2,011.74 1,998.48 1,995.29
Reserves & Surplus 4,782.23 3,624.83 2,722.63 1,827.83 1,108.20

Current Liabilities 4,989.94 5,118.84 4,650.78 3,822.18 2,554.14
Other Liabilities 120,432.89 119,254.79 101,097.67 87,448.11 70,886.75

Assets
Fixed Assets 330.71 333.88 341.69 353.49 347.36

Current Assets 4,338.38 15,836.30 13,945.52 60,862.59 51,733.08
Other Assets 127,554.77 113,845.66 96,195.61 33,880.52 24,463.94

Total Assets 132,223.86 130,015.84 110,482.82 95,096.60 76,544.38
Other Info
Contingent Liabilities 0 1,763.71 311.46 665.73 100.27
CASH FLOWS OF HDFC LIFE INSURANCE CO.
Particulars, Mar-20 Mar-19 Mar-18 Mar-17 Mar-16
Operating Activities 0 9,868.30 6,739.28 6,230.25 5,687.45
Investing Activities 0 -10,181.78 -4,421.15 -5,175.21 -3,959.09
Financing Activities 0 -337.17 -196.35 -235.59 -212.43
Others 0 -0.24 0.24 -2.06 -2.93
Net Cash Flow 0 -650.89 2,122.02 817.39 1,513.00
86
SBI LIFE INSURANCE CO.
INCOME STATEMENT OF SBI LIFE INSURANCE CO.
Annual Mar-20 Mar-19 Mar-18 Mar-17 Mar-16

Sales 1,939.35 1,504.16 1,281.47 1,056.12 969.51
Other Income 6.79 13.54 11.47 8.21 7.93
Total Income 1,946.14 1,517.70 1,292.93 1,064.33 977.44
EBIT 1,413.54 1,372.87 1,184.46 974.57 855.1
Interest 0 0 0 0 0
Tax -8.63 46.07 34.07 19.92 11
Net Profit 1,422.17 1,326.80 1,150.39 954.65 844.1
BALANCE SHEET OF SBI LIFE INSIRANCE CO.
Share Capital 1,000.03 1,000.00 1,000.00 1,000.00 1,000.00
Assets
Fixed Assets 581.18 595.22 581.29 538.47 447.25
Current Assets 84,386.64 6,641.41 6,532.37 53,521.11 41,037.46
Other Assets 80,612.37 139,497.22 114,606.78 48,179.98 41,944.36
Total Assets 165,580.19 146,733.85 121,720.44 102,239.56 83,429.07
Other Info
Contingent Liabilities 0 1,504.83 859.98 442.1 484.71
87
CASH FLOWS OF SBI LIFE INSURANCE CO.
Particulars. Mar-20 Mar-19 Mar-18 Mar-17 Mar-16

-
Investing Activities 0 13,552.86 -8,909.81 -9,031.24 -7,203.73
Financing Activities 0 -241.06 -221.25 -144.43 -143.99
Others 0 0.46 0.15 -0.52 0
Net Cash Flow 0 -320.6 1,264.06 -651.07 -1,569.78
ICICI PRUDENTIAL LIFE INSURANCE COMPANY LTD.
INCOME STATEMENT OF ICICI PRUDENTIAL LIFE INSURANCE CO.
Particulars Mar-20 Mar-19 Mar-18 Mar-17 Mar-16
Sales 2,651.56 1,721.34 1,831.12 1,798.52 1,809.53
Other Income 0.95 9.31 5.03 28.63 0.05
Total Income 2,652.51 1,730.65 1,836.15 1,827.15 1,809.58
Total Expenditure 1,585.53 569.28 117.08 42.63 38.23
EBIT 1,066.98 1,161.38 1,719.07 1,784.52 1,771.36
Interest 0 0.13 0.17 0.1 0
Tax 0 22.32 99.73 102.76 121.21
Net Profit 1,066.98 1,138.93 1,619.17 1,681.66 1,650.15
88
BALANCE SHEET OF ICICI PRUDENTIAL LIFE INSIRANCE CO.
Share Capital 1,435.86 1,435.78 1,435.50 1,435.35 1,432.32
Assets
Fixed Assets 477.76 475.7 422.06 213.8 219.6
Current Assets 3,839.46 3,337.14 2,714.29 2,865.70 1,477.26
Other Assets 151,713.61 159,273.37 138,682.52 121,661.32 103,068.15
Total Assets 156,030.83 163,086.21 141,818.87 124,740.82 104,765.01
Other Info
Contingent Liabilities 0 418.17 237.74 218.53 258.5
CASH FLOWS OF ICICI PRUDENTIAL LIFE INSURANCE CO.

Particulars.
Investing Activities 0 -7,558.66 -5,388.76 -696.25 27.17
Financing Activities 0 -843.38 -1,187.73 -993.92 -1,442.36
Others 0 -0.02 0 -0.07 -0.08
Net Cash Flow 0 2,974.77 -886.6 2,439.46 2,219.49
89
BIBLIOGRAPHY AND REDRENCES
 https://www.moneycontrol.com/annual-
report/hdfclifeinsurancecompanylimited/directors-report/HSL01#HSL01
report/sbilifeinsurancecompany/directors-report/SLI03#SLI03
report/iciciprudentiallifeinsurancecompany/directors-report/IPL01#IPL01
 https://www.adityabirla.com/businesses/companies/aditya-birla-capital-
abcl/aditya-birla-sun-life-
insurance#:~:text=Formerly%20known%20as%20Birla%20Sun,traditional
%20term%20plans%20and%20Unit
 http://www.iloveindia.com/economy-of-india/top-50-companies/aditya-
birla-group.html
 http://www.iloveindia.com/economy-of-india/top-50-companies/aditya-
birla-group.html
 https://www.screener.in/company/HDFCLIFE/consolidated/#analysis
 https://www.screener.in/company/SBILIFE/consolidated/#analysis
 https://www.screener.in/company/ICICIPRULI/consolidated/#analysis
90

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A Summer Internship Project Report

EQUITY RESEARCH ANALYSIS OF LIFE INSURANCE SECTOR

Aditya Birla Sun Life Insurance Ltd. Company

Shalaka Rajendra Nalage

Batch - 2019 - 2021

Under the guidance of

Prof. Rupali Kittur

In partial fulfillment of the requirement for the award of Degree of Master in

MIT-WPU School of Management (PG), Pune.

This is to certify that Ms. SHALAKA RAJENDRA NALAGE of

EQUITY RESEARCH ANALYSIS ON LIFE INSURANCE SECTOR

Internal Project Guide Head of School Director General – Provost

School of Management (PG) School of Management (PG) Faculty of Management

TO WHOMSOEVER IT MAY CONCERN

For Aditya Birla Sun Life Insurance

award of any degree.

Signature of the student

(SHALAKA RAJENDRA NALAGE.)

SR. No. PARTICULARS Page No

3 Objectives of the project. 10

8.2 Country Analysis. 27

8.3 Sector Analysis. 36

8.4.2 ICICI Prudential Life Insurance Company Ltd. 54

TABLE NO. PARTICULARS PAGE NO.

1 Listing information of HDFC Life Insurance co. 43

5 Financials and ratios of HDFC Life Insurance co 51

7 Management team of ICICI prudential Life Insurance co. 55

10 Listing information of SBI life insurance co. 66

This project is about the equity research analysis of the life

Equity research mainly means analyzing the company's financials

Equity research is all about the valuation of a listed company. i.e.

Equity research analysis is very important aspect of the companies

WHAT IS THE RELATION BETWEEN LIFE INSURANCE

Equity research mainly means analyzing the company's financials

Equity research plays an important role that fills the information

Equity research also plays very important role to maintain the

OBJECTIVES OF THE PROJECT :-

3.2 SIGNIFICANCE OF STUDY:

3.3 SCOPE OF THE STUDY:-

This research analysis includes only fundamental analysis.

5.1. COMPANY PROFILE :-

INTRODUCTION OF ADITYA BIRLA GROUP :-

The Aditya Birla Group is India’s first actually multinational

India’s leading copper producer

INTRODUCTION OF ADITYA BIRLA SUN LIFE

source : Google image

Aditya Birla Sun Life Insurance Company Limited (ABSLI), is a

IRDAI Is designed to safeguard and protect the interest of the policy

The business of life insurance in India in its existing form started in

Company gives 6 types of plans are as follow :-

Premium Back Term Plan Endowment plan

ULIP ( Unit Link Insurance

1. TERM PLAN :- Premium is very low which is a positive side but, no

TOP 7 INSURANCE COMPANIES IN INDIA :-

1. LIFE INSURANCE INDIA, (2009) AUTHOR WAS H. SADHAK :-

2. DECCAN CHRONICLE, (2019) AUTHOR IS SANGEETHA G. :-

3. ENTREPRENEUR INDIA. (2020) AUTHOR IS BRIAN

4. ECONOMIC TIMES (2020) :-