SBILIFE — earnings call

The transcript as filed. Every paragraph is addressable: its link names the page and the position it sits at in the call.

Prepared remarks

Moderator · Conference Operator

Ladies and gentlemen, good day and welcome to the SBI Life Insurance Company Q2 FY '26

The first question comes from the line of MW Kim with JPMorgan.

MW Kim

Sir, I note that overall, the protection business is expanding rapidly.

However, on the review of the EV movement, it appears that the current EV unwind is substantial relative to the new business addition.

So, I have two questions.

The firstly, is the company targeting higher growth in the protection sales over the coming period?

If so, what is the management expectation for the mix of the protection business contribution over next 12 to 24 months?

Secondly, given this focus, should we expect potentially the milder near-term earnings growth potential as a greater portion of the profit may be deferred and recognized over the longer period if the protection book starts growing larger?

So that is my question.

Thank you.

Moderator · Conference Operator

The next question comes from the line of Kushagra Goel with CLSA.

Kushagra Goel

Just a clarification.

So, you said you expect individual protection to be more than 10% of individual APE.

Can you give some timeline as to when do you expect this to happen?

Moderator · Conference Operator

The next question comes from the line of Avinash Singh with Emkay Global.

Avinash Singh

Just two clarifications.

The first one is, again, on margins.

So, the 20-basis point margin impact is for last 9 days or 11% of first half individual business.

Does that mean that 60 basis point impact is coming from that 89% of the business that you wrote where you had to kind of adjust your maintenance expense assumptions?

So is my understanding correct that this 60-basis point impact is coming on the business written after 1st April 2025 until 21st September.

And on that business, you have to now readjust your maintenance expense assumption?

So that's one.

And the second piece clarification, of course, I mean, you clarified that you are going to adjust or rather pull-on other levers at the product level and operational efficiency to drive or rather adjust for this margin loss, GST impact.

But does that mean that, okay, I mean, if you are not going to touch the distributor commission of course, that's already very low.

But if you're not going to touch that and also, if you are not going to touch your product construct in ULIP, I mean, your reduction in yield, does that mean -- I mean, at the product level, ULIP is going to see some softer margins?

These are my two questions.

Moderator · Conference Operator

The next question comes from the line of Swarnabha Mukherjee with B&K Securities.

Swarnabha Mukherjee

A couple of questions on other products.

I mean, so first of all, non-par, just wanted to understand that in this category, we have seen strong growth.

I think our overall absolute numbers also look very strong compared to what we have seen in the last few quarters.

Now what is the headroom for growth in this product?

I think essentially, this quarter, growth was largely driven by this product.

So, what is the headroom for growth?

And given the third quarter, normally, we see an uptick on the ULIP side, this year, would we be able to replace with non-par in terms of the mix going forward?

So, what will be the strategy there?

And given that you mentioned that you have passed on the benefits of the yield curve movement to customers, then how should we think about the margin in this product?

Is there a bit of a margin squeeze there?

If you could help us understand that.

Second is on the group savings side.

So is this group fund management product or is also group annuity classified in this?

Because the reason why I'm asking you the question is because I think the sizable jump in this product.

However, your overall margin profile has been very strong this quarter.

So just wanted to understand that is this a detractor in terms of margin this quarter?

And had this growth been not there, then would we have expect the overall margin profiles to be even stronger?

So I wanted your comments on that.

Yes.

So these are my two questions, sir.

Moderator · Conference Operator

The next question comes from the line of Sanketh Godha with Avendus Spark.

Sanketh Godha

Sir a small clarification.

So if the product mix, what you have done after September 22 remains broadly the same, then the impact you are expecting to be on the full year margin is 174 basis points.

That's the right understanding, sir, right?

Moderator · Conference Operator

The next question comes from the line of Nidhesh with Investec.

Nidhesh

First question again is on the GST impact.

I'm not able to understand why in VoNB box the impact is 80 basis points, while you are saying that the recurring impact is only 20 basis points.

So, what is leading to this 60-basis point impact that we have seen in H1 because of GST change?

SBI Life Insurance Company Limited October 24, 2025

Moderator · Conference Operator

The next question comes from the line of Madhukar Ladha with Nuvama Wealth Management.

Madhukar Ladha

Sir, just first on the GST.

So, what I understand is if we don't do anything, then there is about 174 basis impact point on the margins, which you are saying is that currently, the new business mix profile, if that sustains, then it will completely offset this negative impact.

Is that understanding correct?

Moderator · Conference Operator

The next question is from the line of Dipanjan Ghosh with Citi.

Dipanjan Ghosh

So, a few questions.

First, you mentioned your growth on the online business, both in terms of IRP and also in terms of protection.

And those are quite strong numbers.

So, I just wanted to get some sense of the strategic change on the online side and what is really driving this growth?

And is there a vision that you have discussed with your counterparties on the online side in terms of the counter share that you would want to have at those specific counters?

Second question is on the non-SBI banca.

In your opening commentary, you mentioned that there has been a strong growth in those channels also.

So, could you give some colour on your counter share in those channels or the overall growth trajectory or the product mix that you are targeting in those non-SBI banca channels?

And third, you have touched upon this, but just wanted to kind of dig a little bit deep in terms of what norms were there till August, which got tweaked in September because of which you are seeing incremental growth picking up at agency and banca.

If you can give some granular colour on that part?

Moderator · Conference Operator

The next question comes from the line of Vinod Rajamani with Nirmal Bang.

Vinod Rajamani

So I had a question on this par construct specifically.

If you're saying that you're not going to tinker with, say, the commission payouts and so on, and you're trying to also increase, trying to attach more riders and also increasing tenor and so on.

But given the issues with the participating product construct, will it be fair to say that a lot of the costs of this GST and so on will be borne by the end consumer in the sense that the returns might be below what it was, say, before this input tax credit was allowed.

So that's the only question I have on the participating product.

Moderator · Conference Operator

The next question comes from the line of Nischint Chawathe with Kotak.

Nischint Chawathe

I was just looking at the impact on EV because of the GST change and likewise on the margins.

And I understand that you shared a part of the margin impact basically happening to the renewal business.

But if I try to really do the ratios, the way it works out to be is that the impact on EV is around 40-odd basis points, 40, 45.

But if I pick up the renewal business for the -- basically, it works out to something like around 67, 70 basis points.

So first of all, is my math accurate?

And why would there be distraction?

Moderator · Conference Operator

The next question comes from the line of Shreya Shivani with Nomura.

Shreya Shivani

Congratulations on a good set of numbers.

I have two questions.

My first question is on the expense ratio side.

This is the non-commission expenses.

That seems to be slightly higher this year versus trends in the previous year.

Any colours on what is adding to this?

My second question is on the other channel, which has been doing well for us.

Now I understand you mentioned that the non-SBI bank is about 3% of the mix.

So, 14 minus 3%, what is the split of the remaining 11%?

How much would be our website, how much would be brokers?

And sorry, one more question, third question.

Can you give us in descending order, what is the product which gets hit the most because of the GST cut and which one would be the least impacted for SBI Life?

Moderator · Conference Operator

Ladies and gentlemen, that was the last question for today.

I now hand the conference over to the management for their closing remarks.

Amit Jhingran

Thank you very much, everyone, for your time and queries.

You may get in touch with our Investor Relations team in case you have any follow-up questions.

Thank you, and good day ahead.

Moderator · Conference Operator

Thank you.

On behalf of SBI Life Insurance Company, that concludes this conference.

Thank you for joining us, and you may now disconnect your lines.

Thank you.

Safe harbour

Please note that this transcript has been slightly edited for the purpose of clarity.

Except for the historical information contained herein, statements in this release which contain words or phrases such as 'will', 'would', ‘indicating’, ‘expected to’ etc., and similar expressions or variations of such expressions may constitute 'forward-looking statements'.

These statements by the Company and its management are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions and are not guarantees of future performance.

Because forward- looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control, and actual results could differ materially from those presented in the forward-looking statements.

Questions and answers

“SBI Life Insurance Company Limited