Max Financial Services Q1 Results Review - Inline; Axis Group Raises Stake To 19%: Motilal Oswal

Motilal Oswal Report

Max Financial Services Ltd. reported a healthy performance in Q1 FY24 with annual premium equivalent/value of new business growth of 10%/16% YoY, while VNB margins came in at 22.2%.

The performance was broadly in line with our estimates.

In Q1 FY24, all products demonstrated a YoY growth, except for unit linked insurance plans, which declined 27% YoY (down 56% QoQ).

Max Life's retail protection was up 26% YoY/down 23% QoQ. Group protection grew 10% YoY/ 36% QoQ. Total protection increased 16% YoY, while participating business grew 10% YoY. Non-par savings rose 55% YoY (down 71% QoQ).

We estimate a 14% APE compound annual growth rate over FY23-25, thus driving 10% VNB CAGR over FY23-25E.

We reiterate our Neutral stance with a revised target price of Rs 900, premised on 2.0 times March-25E embedded value and a holding company discount of 20%.

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