Mehabe score: 5 G Factor: 2 Piotski Score: 5 The stock has a rating OBSERVE & HOLD. The mehabe team score is reflective of its fundamental and technical merits. A rating above 8 is considered good buy. The stock has a G-Factor of 2 and Piotski score of 5.
Description
SBI Life Insurance Company is carrying on the business of life insurance and annuity.(Source : 202003-01 Annual Report Page No:213)Site:SBILIFEMain Symbol:SBILIFE
Stock trades at 1186.0, above its 50dma 1158.36. It also trades above its 200dma 1020.03. The stock remains bullish on techicals
The 52 week high is at 1253.65 and the 52week low is at 755.25
Price Chart
P/E Chart
Sales and Margin
Strengths
– is almost debt free.
– is expected to give good quarter
Weakness
– Stock is trading at 11.21 times its book value
-Tax rate seems low
-Earnings include an other income of Rs.875.66 Cr.
-Dividend payout has been low at 10.75% of profits over last 3 years
-Promoter holding has decreased over last 3 years: -28.41%
Competition
– The industry trades at a mean P/E of 75.5x. ICICI Pru Life trades at the industry’s max P/E of 144.74x. SBILIFE trades at a P/E of 92.1x
– Industry’s mean G-Factor is 3.0 while the mean Piotski score is 7.0. SBILIFE has a G-Factor of 2 and Piotski scoreof 5.
– Average 1 month return for industry is -3.9%. The max 1- month return was given by SBI Life Insuran: a return of -3.01 %
Quarterly Results
Sales for period ended Sep 2021 is Rs 25636.0 cr compared to Rs 18640.0 cr for period ended Sep 2020, a rise of 37.5%
Operating Profits reported at Rs 272.0 cr for period ended Sep 2021 vis-vis 204.0 for period ended Sep 2020 .
Operating Margins contracted -3.3 bps for period ended Sep 2021 vis-vis Sep 2020 .
The EPS for Sep 2021 was Rs 2.47 compared to Rs 2.23 for previous quarter ended Jun 2021 and Rs 3.0 for Sep 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 88647.0 cr for period ended TTM vis-vis sales of Rs 81913.0 cr for the period ended Mar 2021, a growth of 7.6%. The 3 year sales cagr stood at 25.7%.
Net Profit reported at Rs 1235.0 cr for period ended TTM vis-vis sales of Rs 1456.0 cr for the period ended Mar 2021, falling 17.9%.
Company reported a poor Net Profit CAGR of -2.4% over the last 3 years
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
CashFlow from operating activities: Rs 23878.0 cr for period ended Mar 2021 vis-vis Rs 19299.0 cr for period ended Mar 2020
Sales Growth
Profit Growth Statement
Profit Growth Statement
Stock Price CAGR
Return of Equity
General Comments
– The company has had stable/constant Return on Equity (RoE) metric. The RoE on Last Year basis was 14.0% compared to 16.0% over the last 3 Years. – The stock has given a return of 53% on a 1 Year basis vis-vis a return of 28% over the last 3 Years. – The compounded sales growth on a TTM bassis is 62% vis-vis a compounded sales growth of 34% over the last 3 Years. – The compounded profit growth on a TTM basis is -11% vis-vis a compounded profit growth of 4% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has fallen for the period ended Sep 2021. The Sep 2021 fii holding stood at 24.48% vis-vis 27.24% for Jun 2021 – Public shareholding has remained largely constant. The Sep 2021 public holding stood at 7.77% vis-vis 7.43% for Jun 2021
Conclusion
– is almost debt free.
– is expected to give good quarter – Stock is trading at 11.21 times its book value
-Tax rate seems low
-Earnings include an other income of Rs.875.66 Cr.
-Dividend payout has been low at 10.75% of profits over last 3 years
-Promoter holding has decreased over last 3 years: -28.41%
Fundamentally, the stock remains weak on business fundamentals. Weak near term results have dampened and questioned business drivers. We suggest to wait for a upturn in business performance.
Technically, the stock trades above its 50 DMA 1158.36 and is trading at 1186.0 It has shown near term bullish momentum contrary to business fundamentals. We suggest to observe price action. However as investors, who like to avoid timing the markets, we suggest to avoid the stock
