In Monday’s trade on April 21, 2025, shares of HDFC Life Insurance Company witnessed a dip of over 2% amid an otherwise buoyant market, signalling cautious investor sentiment surrounding the company’s future growth trajectory. The stock touched an intraday low of ₹704 per share on the Bombay Stock Exchange (BSE), registering a 2.2% fall, before slightly paring losses.
At 11:11 AM IST, the share was trading at ₹709.15, down 1.52% from the previous close, even as the BSE Sensex surged 0.98% to 79,323.24. The current market capitalisation of HDFC Life stood at ₹1.52 lakh crore. Notably, the stock has seen a decent run in the past year, gaining 19%, comfortably outperforming the Sensex’s 6.6% rise during the same period. The stock’s 52-week high is ₹760.95, and its 52-week low is ₹511.10.
Despite the healthy annual performance, the recent drop comes on the back of analyst projections suggesting a moderation in the Annual Premium Equivalent (APE) growth for FY26, which is now expected to grow in the mid-teens range.
Solid Q4FY25 performance but growth outlook softens
HDFC Life released its Q4FY25 earnings post-market hours on Thursday, reporting a 16% year-on-year (Y-o-Y) increase in standalone net profit at ₹476.54 crore, compared to ₹411.6 crore in the same quarter last year. Net premium income for the quarter rose 16% Y-o-Y to ₹23,765.56 crore.
Furthermore, the company’s APE for the quarter rose by 9.7% Y-o-Y to ₹5,186 crore. For the full financial year FY25, the total APE grew by 16% to ₹15,479 crore, while new business premium surged 13% Y-o-Y to ₹33,365 crore, indicating consistent demand across products.
While these numbers reflect stability, brokerages have pointed out a likely softening in growth momentum for the first half of FY26. Analysts attribute this to a strong base in 1H25, which may limit the scale of year-on-year improvements in the upcoming quarters.
Analyst insights: Mixed but optimistic
Brokerage Motilal Oswal, in its result commentary, trimmed its value of new business (VNB) margin assumptions by 20 basis points for FY26 and 30 basis points for FY27. However, the brokerage remained optimistic, expecting a 19% VNB compound annual growth rate (CAGR) over FY25–FY27E, with margins set to gradually improve. It reiterated a ‘Buy’ rating with a target price of ₹850 per share.
Similarly, JM Financial Institutional Securities echoed the sentiment that 1H26 growth could moderate but retained a positive long-term view. “We expect consistent 15% APE growth Y-o-Y over FY25-FY27e and foresee a 100 basis points margin expansion across the same period,” said the firm in its latest update. JM Financial also maintained a ‘Buy’ call with a target of ₹850.
What this means for investors
The near-term pressure on HDFC Life shares appears largely driven by concerns over future growth normalisation rather than any structural weakness in fundamentals. The company’s product portfolio, profitability metrics, and long-term strategy continue to be viewed favourably by market participants.
That said, investors should be mindful of potential headwinds, including competition, regulatory changes, and macroeconomic shifts that could impact premium growth and customer acquisition. Also, as the base effect from FY25 results plays out, percentage-based growth in FY26 might look comparatively modest.
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About HDFC life
HDFC Life Insurance Company Limited is one of India’s premier life insurance providers, offering a wide array of products such as term insurance, ULIPs (unit-linked insurance plans), endowment policies, and retirement and pension solutions. It is known for its strong distribution network, innovation in insurance products, and robust digital capabilities.
Conclusion
While Monday’s 2% fall may have taken some shine off the stock, HDFC Life remains a fundamentally strong player in the insurance space. The company’s long-term growth story, supported by solid performance in FY25 and favourable analyst outlooks, suggests that the recent dip could be an opportunity for long-term investors to reassess their positions.
