Canara HSBC gets new 'Buy' from Antique; sees favourable risk-reward
Antique Stock Broking assigned a 'Buy' rating on Canara HSBC Life and a target price of ₹190 per share, an upside of 26.7 per cent from Wednesday's close
 "Canara HSBC gets new 'Buy' from Antique; sees favourable risk-reward")
Antique Stock Broking has initiated coverage on Canara HSBC Life Insurance Company, citing favourable risk-reward and strong medium-term growth prospects.
The brokerage assigned a 'Buy' rating and a target price of ₹190 for the stock, an upside of 26.7 per cent from Wednesday's close. Analysts at Antique said concerns around the company's higher dependence on the bancassurance channel appear adequately priced in at current valuations.
Canara HSBC Life has emerged as one of the fastest-growing private life insurers, delivering an individual weighted premium income (WPI) compound annual growth rate (CAGR) of 21 per cent over FY15-25 and 20 per cent in year-to-date FY26, compared with industry growth of 10-11 per cent, the note said. Its individual WPI market share has risen from 1.6 per cent in FY15 to 2.9 per cent in year-to-date FY26.
Antique expects the company to sustain industry-leading growth, supported by significant penetration opportunities with key bancassurance partners Canara Bank and HSBC, along with the gradual scaling up of a new agency channel.
Value of new business (VNB) margins expanded 200 basis points (bps) year-on-year (Y-o-Y) to 19.7 per cent in the first nine months of FY26, while VNB grew 37 per cent Y-o-Y to ₹413 crore. The brokerage expects VNB margins to improve by at least 50 bps annually over the next few years, despite headwinds from goods and services tax (GST) input tax credit disallowance and investments toward building the agency channel.
The stock is currently trading at 1.7 times and 1.5 times the estimated price-to-embedded value for FY27 and FY28, respectively. Antique has factored in an annual premium equivalent (APE), VNB and embedded value (EV) CAGR of 17-19 per cent over FY26-28, and expects APE to grow at a 17 per cent CAGR during the period.
The brokerage also highlighted strong traction in retail protection following GST cuts. The share of protection business increased from 4 per cent in FY25 to 7 per cent in the first nine months of FY26 and is expected to rise to around 10 per cent by FY28, with retail protection and group term insurance contributing equally.
Key risks include high dependence on the bancassurance channel, regulatory changes, taxation-related uncertainties, and continued investments in the agency channel, Antique said. CHECK Stock Market LIVE Updates
Canara HSBC Life share price history
The counter has risen 0.8 per cent this year, compared to a 2.7 per cent decline in the benchmark Nifty 50. Canara HSBC has a total market capitalisation of ₹14,193 crore.
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