ICICIPRULI - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 20 Dec 25, 11:15 pm

Fundamental Rating: 3.6

📊 Core Financials:

- Quarterly PAT at ₹299 Cr vs ₹302 Cr previously → marginal decline, though YoY profit variation strong (18.9%).

- ROCE at 8.86% and ROE at 7.42% → weak efficiency compared to peers.

- Debt-to-equity ratio at 0.20 → low leverage, manageable.

- Cash flows supported by insurance operations, though dividend yield is very low at 0.13%.

💹 Valuation Indicators:

- Current P/E: 71.7 vs Industry P/E: 84.3 → slightly undervalued compared to peers but still expensive.

- P/B ratio: ~7.4 (₹651 / ₹88) → premium valuation.

- PEG ratio: 4.29 → stretched valuation relative to growth.

- Intrinsic value appears lower than CMP, suggesting premium pricing.

🏢 Business Model & Competitive Advantage:

- ICICI Prudential Life Insurance (ICICIPRULI) operates in life insurance, savings, and protection products.

- Competitive advantage lies in strong brand, bancassurance tie-ups, and diversified product portfolio.

- Market cap of ₹94,259 Cr reflects leadership in private life insurance sector.

📈 Entry Zone & Long-Term Guidance:

- CMP ₹651 is above DMA 50 (₹620) and DMA 200 (₹619), showing near-term strength.

- RSI at 59.9 and MACD positive → neutral to bullish momentum.

- Suggested entry zone: ₹620–₹640.

- Long-term holding only for investors seeking exposure to insurance growth; valuations remain stretched and return ratios weak.

Positive

• Strong quarterly profit variation (18.9%).
• Low debt-to-equity ratio (0.20).
• FII holdings increased by 0.03%.
• Strong brand and bancassurance partnerships.

Limitation

• High P/E (71.7) compared to industry average (84.3).
• Weak ROCE (8.86%) and ROE (7.42%).
• Dividend yield at 0.13% is negligible.
• P/B ratio ~7.4 indicates premium valuation.

Company Negative News

• DII holdings reduced by -0.21%.
• Quarterly PAT declined slightly (₹302 Cr → ₹299 Cr).

Company Positive News

• FII holdings increased by 0.03%.
• Strong YoY profit growth momentum.

Industry

• Life insurance industry is growing with rising demand for protection and savings products.
• Industry P/E at 84.3 indicates sector is richly valued, though ICICIPRULI trades at a slight discount.

Conclusion

⚖️ ICICI Prudential Life Insurance shows growth momentum and strong brand positioning but suffers from weak return ratios and stretched valuations. Entry is favorable around ₹620–₹640 for long-term investors seeking exposure to insurance growth, though caution is advised due to premium pricing and modest profitability.