VNB is a key performance measure, indicating the expected future profits from the new insurance policies and the long-term growth potential of the company’s new businesses. Overall performance may reflect the impact of regulatory changes, a high base and an evolving product mix – with a continued shift towards higher margin non-participating (non-par) products.
The estimates from Kotak Institutional Equities and Emkay Research have also been taken into account.
This is what brokers predict:
1. Annualized premium equivalent (APE)
Most brokers expect LIC’s APE to decline modestly on a year-on-year basis due to weak new business momentum and high base effect.– Kotak Equities estimates APE at Rs 16,380 crore, down 0.5% year-on-year but up 29% quarter-on-quarter.
– Emkay Research expects 4.6% year-on-year decline to Rs 15,710 crore
– JA Securities projects Rs 14,840 crore, a sharper decline of 10% YoY and up 17% QoQ.
– Centrum Broking: Rs 16,213 crore, down 1.5% YoY and up 28% QoQ
Kotak said LIC’s year-on-year decline in APE is similar to the run rate in the first two months of the quarter.
“We are basing new business growth assumptions based on trends observed up to August 2025, when LIC showed 21%/35% NBP/APE growth for Q2 2026 (July and August 2025) versus Q1 2026 (April and May 2025),” YES said in an outlook note.
Emkay attributes strong retail APE growth in the September quarter of FY25 to a year-on-year decline in Q2FY25. The base effect comes into play due to the channel push ahead of the implementation of the new surrender rules, the brokerage noted.
2. Value of new production (VNB)
– Kotak shares: Rs 2,844 crore, down 3.3% YoY and up 46% QoQ
– YES Effects: Rs 2,374 crore, down 19% and up 22% QoQ
– Center Broking – Rs 3,018 crore, up 3% YoY and up 55% QoQ
– Emkay research: Rs 2,821 crore, down 4.1% year-on-year
VNB’s performance is expected to remain stable, aided by an improved product mix and cost control.
3. VNB margin
– Kotak Equities forecasts a margin of 17.4%, down 50 basis points YoY and up 199 basis points QoQ
– Centrum Broking: 18.6%, up 82 bps year-on-year and up 325 bps quarter-on-quarter
– Emkay Research estimates it at 18%, up 10 basis points year-over-year
– Yes Securities expects QoQ growth of 63 bps, helped by mix improvement.
4. New Business Premium (NBP)
According to Yes Securities, NBP is expected to stand at Rs 58,677 crore, up 1% YoY but marginally lower 1% QoQ, reflecting stable momentum after a robust start to FY26.
5. Assets under management
Emkay Research estimates LIC’s assets under management at Rs 58.93 lakh crore, up 6.4% year-on-year, supported by stable inflows and positive market movements during the quarter.
6. Profit after tax (PAT)
Emkay is the only broker among its peers to have provided net profit estimates of Rs 8,198 crore, up 7.6% year-on-year, with continued benefits of stable operating performance.
7. Major monitorables
Investors should monitor LIC’s commentary on non-standard product expansion and business mix shift, impact of disallowance of GST ITC on margins and profitability and growth in the group’s APE and retail segments.
Embedded value (EV) trends and management guidance for H2FY26 also remain important features to watch for.
(Disclaimer: The recommendations, suggestions, views and opinions expressed by the experts are their own. These do not represent the views of The Economic Times.)
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