Shriram Life Insurance Company Limited
Shriram Life Insurance is the Shriram Group company catering to the Life Insurance business of the Group. Let us first know briefly about the Shriram Group businesses and then we will move on to study Life Insurance Business.
Shriram Group
a) Shriram Group, established in 1974, is among the leading corporate houses in India and is a major player in the Indian financial services sector.
b) Shriram Group’s presence in financial services is diverse ranging from Commercial Vehicle Financing, Retail Financing, Enterprise Financing to small business, Housing Finance, Equipment Financing, Life Insurance, General Insurance, Retail Stock Broking, Distribution of Financial Products, and Wealth Advisory Services. Financial Services Companies in the Group manage assets of around INR 1,500.
Partnership with Sanlam to start Insurance Business
Sanlam, a leading financial services group and one of the largest insurers in South Africa has partnered with Shriram Group in both its Life and Non-Life Insurance ventures. The effective leveraging of the network and brand equity of Shriram Group and strategic guidance by the Sanlam Group has facilitated a steady growth of the insurance companies.
Shriram Life Insurance Business
Started in the year 2005, they offer different life insurance plans for their customers which include Individual Plans, Online Plans, and Group Plans. To know more about the plans you can visit. Shriram Life Insurance has a branch network of 588 branches and has an advisor force of 4455.
Financials Metrics
1. New Business Premium- We know when we purchase a policy we pay the premium. That premium when added together from all the users who have taken policy in a given year is known as New Business Premium.
2. Renewal Premium – This is the premium of all the policyholders who have taken insurance policy prior to the current year in which we are calculating the premium. This is an important factor because sometimes people take the policy and then say after 1Y, 2Y or any other year discontinue the premium.
3. Solvency ratio- It is similar to D/E in other businesses. The IRDAI requires life insurers to maintain a minimum Solvency Ratio of 150%. As compared to the minimum requirement of 150%, the Company’s Solvency Ratio, as of 31st March 2019, was 182%.
Market share of the Shriram Life Insurance business
a) As of 30.09.2020, there is a total of 24 Life Insurers in India.
b) The total premium as of 30.09.2020 stands at 1,24,727 Crores. This is the total premium collected in the first 6 months of FY20-21.
c) LIC has a total premium of 89980 Crores (72%).
d) Private players have a total premium of 36709 Crores (28%). Among Private Players, SBI Life (24%), HDFC Life(23%), ICICI Life (12%), Aditya Birla (6%) are the top players in terms of market share.
e) For the first 6M FY20-21 Shriram Life Insurance has only 248 Crores of premiums. This translates into 0.067% market shares among private players.
Shriram Life Insurance Co. Ltd Unlisted Shares Details:
| Total Available Shares: | 1000 |
| Face Value: | ₹ 10 Per Equity Share |
| ISIN: | INE227H01016 |
| Lot Size: | 100 Shares |
| Current Unlisted Share Price: | ₹ Best In Industry Per Equity Share |
Promoters And Management:
Shareholding Pattern:
| Shareholder’s Name | No. of Shares | % of total Shares |
| Shriram Capital Limited | 13,37,43,744 | 74.56 |
| Sanlam Emerging Markets (Mauritius) Limited | 4,12,56,250 | 23 |
Financials of Shriram Life Insurance Co. Ltd Unlisted Shares:
| Particulars (in Cr) | Mar-16 | Mar-17 | Mar-18 | Mar-19 |
| Number of new policies | 266976 | 200691 | 247183 | 276483 |
| New Business Premium | 694.00 | 734.00 | 810.00 | 813.00 |
| Renewal Premium | 328.00 | 474.00 | 687.00 | 886.00 |
| Sum Assured in Force | 80376.00 | 81915.00 | 96070.00 | 106456.00 |
| Funds under Management | 2528.00 | 3076.00 | 3544.00 | 4196.00 |
| Expense ratio | 51% | 42% | 34% | 31% |
| No. of Offices | 568.00 | 604.00 | 609.00 | 588.00 |
| Number of Insurance Agent | 4422.00 | 4508.00 | 4498.00 | 4455.00 |
| Profit Before Tax | 23.00 | 16.00 | 93.00 | 55.00 |
| Profit After Tax | 19.00 | 17.00 | 88.00 | 63.00 |
| No. of shares | 17.50752 | 17.50752 | 17.50944 | 17.53060 |
| EPS | 1.09 | 0.97 | 5.03 | 3.59 |
Comparison With Peers:
| Peer | Premium (Cr) | Mcap | Mcap/Premium | P/E |
| HDFC Life | 17396 | 113999 | 6.55 | 85 |
| ICICI Life | 12348 | 58685 | 4.75 | 54.9 |
| SBI Life | 16591 | 77000 | 4.64 | 53.5 |
| Shriram Life | 708 | 3228 | 4.56 | 53.56 |
Please Note: 1. We have calculated Shriram Life Mcap by considering a price of Rs.180 per share. 2. The premium for 2019-20 was taken into account. 3. The EPS of 2018-19 is taken for calculating Shriram Life P/E.
