Growth intact, margins compressed by lumpy GTI business

IRP delivered 14% growth; PAT ₹7.2B (720 Cr) up 22% YoY, aligns with delivered ₹724.9 Cr

26.2% delivered at lower end of range (ex-GST 27.4%); within but margin pressure evident

GTI was ~25% of APE, materially dragged margins; management says won't repeat at same scale

Delivered result shows QoQ revenue -72.5%, PAT -9.9%; GTI is cited as temporary headwind

Pure protection confirmed at 41% growth; non-ULIP at 38% vs historical ~30–35%; supported

Q1 came in at 26.2% vs prior FY26 range. Management says mix normalization + GTI fade will push toward upper end; no formal raise or cut.

Pure protection grew 41% vs IRP 14%; now 32% of individual protection mix (non-ROP) vs 27% prior year. Strategic shift accelerating.

After 3-year investment (100+ branches, 34k agents added), channel now 20% growth. Management expects continued momentum.

Promised end-Q1 launch; management now says 'hopefully within next quarter.' No urgency signaled; may slip again.

ULIP now 62% vs 65% prior year; non-ULIP (guaranteed + protection) gaining share deliberately; margin positive over time.

GTI is lumpy group business with APE basis of 100% premium, naturally lower margin. Without GTI, individual margins much stronger. Agency investments (100+ branches, 34k agents) are bearing fruit at 20% growth; strategies are working.

GST remains ~1.1% drag vs prior quarter; waived from Sep 22, so 2.5 months impact remaining in Q2, then normalizes. Expense repricing won't eliminate the tax; product mix improvement is the offset.

~45–50% of ULIP policies now sold with rider attachment (was minimal 1 year back). Rider APE is counted as protection. Started 1.5 years back, attachment rate improving from 35% to 50%.

Yes, deliberately shifting from ROP (68% now vs 73% prior) to pure term. Pure protection growth is 41% YoY. Lower ticket but more aligned to protection mission and better margins long-term.

We are working on the product and will launch at the opportune time. Hopefully within next quarter.

Other banks mix is 20% ULIP, 80% non-ULIP. Very strong tilt toward non-ULIP products.

We maintain 26–28% range as healthy target. This quarter was one-off (GTI). Going forward, as product mix normalizes, margin will move toward upper end. No expectation for margin expansion beyond guided band due to competitive dynamics and regulatory environment.

Non-par has very good demand for assured return products. We keep sharp eye on yield curve; repriced IRR in June 2026 per yield movement. This is driving good traction.

3-year track record of 14% CAGR; Q1 delivered 14%; management reaffirmed full-year target. Backed by agency (20% growth) and other channels (31% non-SBI growth).

Q1 came in at 26.2% (lower end). Management says bottom was reached Q1; expects recovery to upper range as GTI fades and non-ULIP mix improves. GST drag expected to persist 2.5 more months then normalize.

Q1 GTI (~25% of APE) dragged VoNB margin by ~60 bps. While management claims it won't repeat, visibility into pipeline is opaque. Risk of further margin surprises.

1.1% margin impact has remained constant across Q3, Q4, Q1 despite time passing. Management expects 2.5 more months in Q2, then normalization. Risk of delayed recovery or permanent margin loss.

Individual protection growth +22% (APE) is soft vs competitors reporting 20–30% growth. Management attributes this to strategic shift to pure term (lower ticket), but risk of market share erosion if competitors capture more high-premium customers.

Sum assured up 46–265% YoY has spiked stamp duty; labor code added permanent cost base. Management expects streamlining but timeline vague. If not absorbed by margin mix, expense ratio may inflate.

IRDAI may tighten regulations on protection products, commission rates, or capital deployment. While management is optimistic on regulatory stance, future changes could compress margins.