Max Financial Services gains after stellar Q4 performance

Max Financial Services (MFSL) advanced 3.44% to Rs 725.20 after the company reported an 88.8% rise in consolidated net profit to Rs 117.68 crore despite an 8.2% fall in total income to Rs 8962.31 crore in Q4 FY22 over Q4 FY21.

Total expenditure during the quarter declined by 9.1% YoY to Rs 8,809.34 crore.

Profit before tax was Rs 152.97 crore in Q4 FY22, which is higher by 127.8% compared with Rs 67.15 crore in Q4 FY21.

The company recorded 40.5% fall in consolidated net profit to Rs 253.37 crore on a 0.3% decline in total income to Rs 31,187.58 crore in FY22 over FY21. Excluding investment income, the consolidated total income grew 17%.

The decline in the profit after tax was primarily due to COVID-19-related provisions in the current year and one-off items in the previous year, Max Financial said.

During the financial year, Max Life - MFSL's sole operating subsidiary - achieved new business margin (NBM) of 27.4% in FY22, an increase of 215 bps and the value of new business (VNB) was Rs 1,528 crore (post overrun), an annual growth of 22%. The 22% growth in VNB has been achieved on a high base of 39% VNB growth achieved in FY21.

Max Life reported an Embedded Value (EV) of Rs 14,174 crore. The operating return on EV (RoEV) over FY22 was 19.2%, which increases to 20.1% after excluding the one-off impact of COVID-19. Including non-operating variances, the total RoEV is 19.8%.

Max Life's total new business premium (individual and group) increased 16% to Rs 7,905 crore. In addition, the renewal premium income (including group) grew 19% to Rs 14,509 crore, taking the gross premium to Rs 22,414 crore, an increase of 18% over the previous financial year.

Max Life's assets under management (AUM) were Rs 1,07,510 crore as of 31 March 2022 - a rise of 19% over the previous year.

Mohit Talwar, managing director, Max Financial Services, said, "Our strong Q4 numbers are a result of our consistent efforts in driving profitable growth across our channels by optimizing for product mix.

Max Financial Services (MFSL) is part of India's leading business conglomerate - the Max Group. Focused on life insurance, MSFL owns and actively manages an 81.83% majority stake in Max Life Insurance, India's largest non-bank, private life insurance company. Max Life offers comprehensive protection and long-term savings solutions, through its multi-channel distribution including agency and third distribution partners.

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