SBI Life Q2 FY26 Net Profit Declines 6.6% YoY to ₹494.6 Crore as Investment Income Goes in the Red; Premium Income Rises 22.6%

Mumbai, October 24, 2025: SBI Life Insurance Company Ltd (NSE: SBILIFE) stock price fell on Friday following the insurer’s announcement of a fall in quarterly profit even as premium growth remained strong. The consolidated net profit of the company dipped 6.6% year-on-year (YoY) to ₹49,459 lakh (₹494.6 crore) for the three months to September 30, 2025 (Q2 FY26), as investment income became negative due to market volatility. But strong growth in premium income from all segments mitigated the overall impact on earnings.

Strong Premium Momentum Despite Market Volatility

SBI Life posted a strong 22.6% YoY rise in net premium income to ₹24,84,831 lakh in Q2 FY26, compared with ₹20,26,610 lakh a year earlier. Sequentially, premiums jumped 44.6% from Q1 FY26, supported by healthy renewal collections and a surge in single premiums. All business categories—first-year, renewal, and single premiums—recorded double-digit growth, underscoring strong customer traction and distribution expansion.

Investment Income Drags Overall Results

The firm recorded a net investment loss of ₹2,05,532 lakh in its policyholders’ account, from a gain of ₹19,75,306 lakh in Q2 FY25. This turnaround was mainly explained by fair-value losses due to unstable market fluctuations on both linked and non-linked assets. As a result, total income from the policyholders’ account plunged to ₹22,80,922 lakh from ₹40,01,504 lakh in the corresponding quarter last year.

At the same time, managerial expenses increased to ₹2,75,917 lakh, reflecting increased commissions and staff-related costs fueled by growing business operations.

Profitability Overview

Even as the investment suffered a loss, SBI Life remained profitable with PBT of ₹51,318 lakh (6.2% down YoY) and PAT of ₹49,459 lakh (6.6% down YoY). Basic earnings per share was at ₹4.93 while the solvency ratio also stood robust at 1.94x, above the IRDAI mandatory requirement.

The expense management ratio of the insurer increased modestly to 11.0%, from 10.57% in Q2 FY25, reflecting prudent cost management against the backdrop of business growth.

Segment-Wise Performance

SBI Life’s diverse product portfolio again led to resilience, with the Linked Individual Life and Linked Pension segments contributing combined more than half of total net premiums for Q2 FY26.

The Par Life segment had a temporary actuarial deficit, whereas Group Life and Pension products were profitable. As of September 30, 2025, segment assets in total were ₹4,64,97,005 lakh, close to policy liabilities of ₹4,64,76,808 lakh, demonstrating good asset–liability management.

Persistency and Operational Ratios

The company maintained healthy customer retention, with persistency ratios as under:

• 13th month: 85.37%
• 25th month: 75.65%
• 61st month: 56.24%

The return on investment (excluding unrealised gains) on policyholders’ funds was at an average of 7.65%, reflecting sound investment management in the face of market turbulence.

Half-Year Performance Snapshot (H1 FY26)

During the period ended September 30, 2025, SBI Life recorded:

• Net premium income: ₹42,02,681 lakh, up 19.0% YoY
• PAT: ₹1,08,896 lakh, up 3.8% YoY
• EPS: ₹10.86, versus ₹10.47 in H1 FY25

Market Performance

As of 3:30 PM IST on October 24, SBI Life shares closed ₹1,845.00, down ₹7.70 or 0.42% for the day. It opened at ₹1,860.00 and moved between a high of ₹1,864.00 and a low of ₹1,831.80 during the session. The company’s market capitalization stands at ₹1.84 lakh crore, with a P/E ratio of 74.38 and a dividend yield of 0.15%. Over the past 52 weeks, the stock has traded between ₹1,372.55 and ₹1,912.00, indicating a broad price range.

Embedded Value and Actuarial Assessment

According to Willis Towers Watson (WTW), SBI Life’s Embedded Value (EV) was ₹76,000 crore as of September 30, 2025, and the Value of New Business (VNB) for H1 FY26 was ₹2,750 crore. WTW mentioned that SBI Life’s valuation method is consistent with Indian Embedded Value (IEV) practices and international best standards, demonstrating uniform actuarial discipline.

Management Commentary

Managing Director and CEO Amit Jhingran said the quarter’s performance reflects SBI Life’s “operational resilience and franchise strength in a volatile environment.” He further informed that the company continues to stay committed towards growing its protection and annuity books, practicing underwriting prudence, and maintaining a healthy solvency level.

REF: https://www.bseindia.com/xml-data/corpfiling/AttachLive/5d48a189-21bb-4ec6-a668-5d1012f664e9.pdf

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