Thank you very much. We will now begin the question and answer session. O ur first question is from the line of Madhukar Ladha from Nuvama Wealth. Please go ahead.

Congratulations on a good performance. I have a couple of questions. I'm just looking at the EV movement. And there's a very big release in the mortality, morbidity and operating variance. So can you explain what really helps that? And we've seen 2 years of good reserve releases of that. The other thing on the monthly numbers that come out Jan and Feb were very strong months, what actually sort of went wrong in March because we would have expected a stronger March to come through as well. And can you also comment a little bit about product level margins. So are we seeing any changes in the nonpar and par business sort of margin at the margin level. So, yes, those would be my three questions to begin with.

Yes, Prithesh, go ahead.

Yes. On EV part, if you look at the operating variance we have make the mortality positive variance, this is a similar thing last year as well if you look into that. And as we keep mentioning that we adopt a prudent approach while setting the assumptions. And our experience is much better than what we assume and that’s the reason you are seeing the positive variance. Other point that we've mentioned last time as well that in the group platform we always wanted to take the schemes which are profitable and those schemes also contributed. We are not just seeking to get the market share in the group term business or credit life business. So both the places you are seeing higher mortality variance coming into. On the product level margin, I think we don't disclose on the product level, but I can say you that each and every time we review our product in terms of movement in the interest rate and all other experience. And within the product, we try to optimize the value both in terms of the margin for the shareholder as well as the better return and better offering to the policy holder as well. And some of the things that we keep adopting the segmented approach in terms of the product offering. So different segments had different experience and we try to reflect those segmental experience in our product offering and that is also helping to get the margin enhancement. Last quarter we have launched two pure TROP products in higher segment which is 25 lakh and above , which has been attractive in the m arket and that's also helping enhancing our margin. And we expect this is going to further en hance our margin on that level.

If I get you correctly the mortality morbidity releases are more from the group business and from the retail protection business?

This is across all because it's a reflect of our comp osition of existing business. So not coming specific for any particular line , it keeps coming across all the lines including protection, including unit linked or ev en traditional product as well b ecause we keep selling traditional individual TROP. So all perspective they're getting this p ositive variance on that.

Okay. But would it be more from the group business, any sense on the contribution?

I don't say this is especially coming from the group business. I t hink overall basis is coming from.

Thank you. Our next question is from the line of Prayesh Jain from Motilal Oswal. Please go ahead.

Hi, and congratulations on a good set of numbers. Just could you repeat the point on the VNB margins, what has contributed to improvement in margins?

No, we are not saying that what has contributed in margin. I think if you look into the last March to this March there is reduction in the margin especially on the account of product mix. If you look into the December to this December our margin stands at the same level. So what we tried to explain in the earlier question when asking for opportunity on the product level margin, we say that we always optimize these things on the segmented approach reflects the experience of that segment. A nd within the product line, there is a lot of opportunity to optimize the value both from the customer as well as shareholder in terms of margin. So that's the reason within the line even we'll do the similar level of business as we are slightly business. There is a possibility for enhancing those value for the shareholder and that’s the reason we're getting to able to maintain this margin.

And just structurally how should we think about margins and growth for SBI Life from FY '25 perspective, which are the product segments that would kind of see growth and particularly whether the nonpar segment would start contributing to growth again in FY '25, how do you see the product mix kind of playing out in FY '25? I understand, generally you all say that it depe nds upon what customer demands, b ut still ULIP has been picking up momentum, whether that momentum should sustain or how should we think about product mix and profitability for FY '25?

If you look at the product mix and you yourself said that ULIP was flavor of the season last year which you very well understand was coming from the very good performance of the stock market. So the equity mar ket performance reflected into the increased demand for ULIP products. Going forward, while we continue to offer all kind of products to all segments of customers, and it all depends on the customer's choice. Having said that, we will definitely like to grow our protection and nonpar business also in the coming year for a healthier product mix.

And that should reflect -- ideally, if that translates, that sho uld reflect into better margins?

Yes, definitely, that will affect our margins and that effect will be for the positive, I must say.

So on the growth, as you know, retired people is the fastest growing segment of Indian population and the NPS scheme is also giving good feel to the annuity business. So in terms of volume growth, we expect annuity to be a long -term growth story in India. Prithesh, anything on margin.

I think this annuity is a very profitable business for us. And it is helping us to enhance the margin for the company. So we try to reprice actively, try to get the business at a cost which is reflecting to the investment return and margin enhancing.

Okay. Would the profitability be higher than the company level?

We don't disclose, but the moment I'm saying that it is helping us enhancing the margin is giving this rate as well.

Can I squeeze in one last question. The private players, all the other private players as well are now looking for more granular growth where in they would be entering Tier 2, Tier 3 cities branch expansions. SBI Life, I think has a better presence in those cities and geographies. Would you see increased competitive pressure with respect to commission payouts and resultant also some pressure on margins because of the kind of competition that could come in. And, your thoughts on competition increasing in Tier 2, Tier 3.

So our presence SBI Life's presence through SBI branches as well as our agency network has already been strong in not only Tier 2, Tier 3 cities, but also in the rural areas. So even now there exists a lot of scope. Having said that, we also say that we don't play the commission game to increase the top line and we will going forward also stick to that. We will meet the customers' expectation. We'll provide them better experience and that will drive our business in the coming year also.

Thank you. The next question is from the line of Sanketh Godha from Avendus Spark. Please go ahead.

Yes. Thank you for the opportunity. Sir, actually the biggest question what I have is that in the current quarter, your banca channel seems to have been muted, very muted actually because you don't have a base problem what other private companies had. And the growth has been pretty weak in the ban ca channel low single digits. S ir just wanted to understand what led to that muted trend in the banca channel growth both in SBI and other banca relationship? And I think one of the participants asked that question why March suddenly fell off the cliff when Jan and Feb were good. So I just wanted to understand how do we read these numbers? And how you expect banca to do going ahead in that sense. That's my first question. Maybe after you answer that, I might squeeze in one more.

So if you have been following the company, you will be aware that the banca channel, over the 4 quarters, December quarter is always the best, and that was true this year also. Last year also, the banca channel after December performance, this is the seasonality of the company and the banca channel, which reflected in this month also. As far as March month is concerned, the industry figure, if you consider then our performance vis-a-vis industry has been at satisfactory level. The industry has gone muted in the month of March.

We understand that point, but other players had the problem of high ticket policies of a bigger base. We did not have that problem, but still the growth was pretty honestly, no one in the industry would have expected a negative growth in the month of March as realized. So just wanted to read that in conjunction with the lower banca growth. So anything to read there that SBI intentionally slowed down or some diktat came from some which led to that muted growth is the whole point, which I want to conclude.

Nothing like SBI slowing down or anything. Month-on-month number, I think the quarter number, if you compare, it will be better. We had a 6% growth over the quarter over last year. So there is nothing like that SBI is slowing down or something, SBI is our parent and we'll continue to have strong relationship with that banca channel.

Okay, sir. Fine. I mean, because the reason I'm asking is that others which is nothing but your other PSU bank relationships that has been also muted at 8 percentage for the quarter year-on-year means that actually do sequentially very well. So again, and sorry for harping that point, whether banca has some kind of a stress, especially PSU Bank from a growth point of view.

No, banca is a very strong channel, and we should not read too much about one quarter's performance. It's a long history.

Okay. And you're confident of the next quarter growth will be more than 15 percentage, sorry for next year gr owth will be more than 15 percentage or do you still want to maintain that guidance of 20% growth?

So as of now we are not putting any number for the current quarter growth, but our long- term growth targets and our CAGR we will definitely like to maintain.

Okay, sir. One more question just on the protection business. See your individual protection was muted for the entire year. Credit Life was also muted. Individual protection declined 5 percentage, Credit Life just grew by single-digit 9 percentage, but large part of the growth came from GTL which grew 67 percentage. So just wanted to understand whether this mix or color will change next quarter -- next year I mean to say or you see on a bigger base individual p rotection is struggling to grow?

So individual protection is one line where we will continue to remain focused and we want to increase that business. The lower proportion in the last year, maybe a reflection of the customer's choice for th e ULIP during the year as other analysts have also pointed out. So I would like to clarify that protection remains our focus area. And we are also going to introduce some more products in this year for growing the individual protection business.

Abhijit, you are confident that the INR9,500 crores will be still repeat next year with the 67% growth?

No. The overall protection is INR2,099 crores, Sanketh.

No. I'm referring to only GTL which you said is INR950 crores for FY '24. That number which is 67% growth year-on-year, you are confident that number of INR950 crores will sustain going ahead too?

Sanketh, we are focusing on as MD said for the overall growth of each segment within the protection, so it starts with individual protection. And Credit Life and GT I both it comes as per the planned numbers. And we expect that we will try to improve upon those numbers, but GTI as you know this is based on some specific transactions. And it depends on the geogr aphy to geography. So we will be focusing on overall growth. As Abhijit said, we have already launched two products during this quarter and we expect that the individual protection will grow in a better proposition than the group.

Perfect sir. Thank you very much. That’s it from my side.

Thank you Sanketh.

Thank you. The next question is from the line of Mahek from Emkay Global. Please go ahead.

Thank you for the opportunity. Congratulations on the good set of numbers. I have two questions. One is, what would be the reason for a negative INR285 crores of rewards in the quarter 4 results? And secondly, if I see that 37th month persistency it is at 71.3% which has seen a drop in this year. So I wanted to move the reason for the drop. That's all?

So there is this cohort of the COVID period. Last year, if you have noticed, if you remember the number, the drop was in 25th month and that COVID cohort has moved to 37th month and we have seen some fallout there. But there is nothing much to read. We have other persistency in all cohorts, 13th month, 25th month, 49th month and 61st month, everywhere it has increased. So that 37th month is one exception related to the COVID cohort. And you will like to answer about this?

Yes. So as you know we have also communicated previously that we appropriately made some provisions as far as the discussions going on with our respective banca partners. So which has actually we've seen that as per our estima tes which we have designed or defined or we have achieved. So then the remaining we have reversed that. So this year, we will again see how it will shape up. And accordingly, if it is required, then we will provide it.

Thank you sir.

Thank you. Our next question is from the line of Supratim Datta from A mbit Capital. Please go ahead.

Thanks for the opportunity. So firstly, I wanted to understand on the group savings side there has been a significant jump this year. Just wante d to understand what is driving that. And the second question was on SBI. I know you have answered this before, but I just wanted to understand that we have seen significant productivity gains there at a branch level. Now that seems to be plateauing. So would it be fair to assume that now further penetration within the branches could become more limited and you should be growing more in line with the bank as compared to ahead of the bank? Is that a correct as sumption to make? Those are my two questions.

Look at the branch penetration in SBI. Our penetration in the overall customer base of SBI is only around 2%. And if you see the insurable kind of people with more than say 10,000 balance, there also our penetration is between 3.5% to 4%. So th at leaves us still a very, very large population of customers of 96%. So you cannot say that it is plateauing. We are making cautious effort to improve insurance penetration in the entire population. And there is our 96% kind of cohort where we have ample scope to improve the productivity further.

On the part of group savings as you know these are all lumpy businesses. So depending upon the corporate's requirement we get across the year and as principally we have been restricting our this number between around 18% to 20% of my total NBP so which I think we are under very much control. So we will look into on year on basis how this business will flow.

Got it. And sir, just one follow -up to that penetration question. Just wan ted to understand, do you have any idea about how many of these insurable customers may have an insurance policy with some company already? And how many would not have any insurance policy? Do you have any data on that front?

I don't think we have that kind of information available with us.

Okay. No problem. Thank you sir.

Thank you. T he next question is from the line of Nidhesh Jain from Investec Capital. Please go ahead.

Thanks for the opportunity. T wo questions. Firstly, what all is constituted in other channels that we disclosed in bancassurance I think only SBI Bank is considered, but all channels are included. And secondly, if you can give the breakup of protection -- group protection APE between group protect between GTI and Cr edit Life for FY '24 and FY '23?

See, other channel consists of my all banker relationships excluding SBI and corporate agents, brokers and the other online channels also and the bifurcation of the group protection the difference is around 55% of the total protection is coming from this Credit Life and GTI.

Yes. Between GTI and Credit Life it will give the number what is the contribution from Credit Life and GTI in the APE individually?

So for GTI, it will be INR930 crores. And for Credit Life, it will be INR226 crores.

So these are all APE?

APE.

Thank you sir. That’s it from my side.

Thank you.

Thank you. The next question is from the line of Dipanjan Ghosh from Citi. Please go ahead.

Hello. Good evening. Hope I am audible. So two, three questions from my side. First, a data-keeping question. If you can split your expected return on the existing business in your EV work between the unwinding at the reference rate and unwinding on real-world excess returns. I assume you used to report it historically. Second, on these other channels which has been the non -SBI non -agency channel which has been reporting quite a strong growth. I just wanted to get some sense of how do you think of the payout shaping up at these counters once you start expanding at a very fast pace at some of these counters? And lastly, on the margin front, let's say, next year when ULIPs, for example, let's say, we have to compress, do you see competitive pressure rising in some of the other channels in terms of the pricing pressure that maybe your competitors are willing to offer. So is there a risk to your product l evel margins ? So those were my three questions.

Prithesh?

So on this EV basically , expected return perspective , we don't have readily available this number. So we need to reflect that. I think to be fair & comparable to the market we have used that. I think is the RFR what is coming from and then expected if you look at the total basis the return is more or less similar as last year. So it is coming on that perspective. And on the margin perspective I don't think much pressure will come on the anyone launching the product at all. We try to be reviewing and actively repricing our products. So our endeavour is either to maintain the margin or try to enhance those margins. So we don't see any stress coming on those products level margin.

And on the partners even this year we have some agreements with our partners for which we had made provision. So next year also, we will have some parameter -based numbers. So we don't see any significant pressure coming from that side.

Sir, just one follow-up on the first question. Will it be safe to assume that your excess returns, I mean, the real-world excess returns, the assumptions have not changed meaningfully this year. Would it be a safe assumption to make?

Yes it is. That it's not changed much because as you ment ioned the expected return and basically you look into your blended return that you expected, depending on your asset mix for existing portfolio and what do you expect in the future. So our approach is unchanged except might be some impact might have on account of the change in yield curve that accounted for the new investments. Otherwise, it's fairly safe. You can assume that at a similar level.

Got it sir. Thank you and all the best.

Thank you. T he next question is from the line of Neeraj Toshniwal from UBS India. Please go ahead.

Hi, sir. Congrats on good set. Wanted to understand again on the product level margin, are we seeing improvement in any of the product margin because even we are ULIP heavy, so we have managed to deliver a decent s et and would this mean that this will become base margin going ahead, you can see further improvement with the mix improving in FY '25?

I think, yes, there is an improvement in the margin within the line of business. That's also helping us both on t he non-par and protection side, even that we mentioned that we launched protection products where margin is slightly higher than what it used to be earlier. So we continue reviewing that. So we'll see the enhancement coming from. And if you summarize that if you're abl e to get the better product mix from the current levels that we are aiming for, I think there will be upside from the current level rather than any downside.

So another two products which you talked about which you have launched in this quarter, which means April running quarterly are basically focusing on the pure protection plan rather than ROP if I get it correct?

No, this is a two plan that we have launched in Jan. It is mostly on the TROP for the higher segment level with 25 lakh and above and we are in the process of reviewing this and coming out with a pure protection product as well. As our MD also mentioned that objective is to continue to focus on protection. So we will be continuing reviewing the portfolio and c oming out of other produc ts, two or three products are already in pipeline in the protection side.

Sure sir. Thank you so much.

Thank you. Our next question is from the line of Anurag Mantry from Oxbow. Please go ahead.

Just one question from my side. So there was total number of policies, the individual number of policies in FY '24 based on the IRDAI data has grown only 3% this year. This used to be like mid double digit last 2 years. So anything specific to under stand from this?

See, overall we have been growing in a better shape as far as the number of policies are concerned during the last few years. This year, our improvement for the ticket size has shown growth over the number of policies. And we have anticipated a better number in our no npar portfolio, which is consisting of both protection and nonpar guaranteed savings which has not come up as you have seen from the numbers. But we expect that this will correct in the coming years because as already mentioned, we are focusing on the product mix, which will go towards non-ULIP, so the number of policies will also enhance in the coming years.

Thank you. The next question is from the line of Aditi Joshi from JP Morgan. Please go ahead.

Thank you for taking my question. Just my first question is on the economic assumption change. So when I compare this economic assumption change the impact of this in the embedded value movement versus the NBV movement, the economic assumption change is positive for EV whereas negative for VONB. So can you please help explain this difference? And just a related on that before you change your assumptions, how many years of experience you observed as in the last 2 to 3 years or 5 years before you think that it's time to make the changes in the assumptions? And my second question is related to the growth differential between Tier 2, Tier 3 and Tier 1 cities, if you are able to share some growth numbers as in where the growth is higher in NBV. Is it higher in Tier 1 as compared to Tier 2 or Tier 3 or vice versa?

Prithesh, can you respond to the first part.

Yes. So I will respond to two question on the perspective. When you set the assumptions we do look into the historic experience, we look into that trend and in terms of the trend we look into the 5-year trend and 3-year trend. And objective is to look into what is the emerging trend. And all our assumption reflecting to the emerging trend to reflect the demographics assumption recommendation. Other question, you are looking for economic impact of the economic assumption change. So when you look into this impact when you go to the EV, it reflect on existing book and that's changed from the point to the point. So if you look at the March changes, 31 March 2023 to 2024, So when you look to the VONB perspective is the average and that's reflected the new business composition. And as you know that our also indicates the interest rate movement will have a different impact as unit-linked business and non-linked business. That's the reason we see slight variation coming from that prospect.

In terms of growth, it is more not Tier 1, Tier 3. It is more state and other customer segment growth, which has varied. We've not seen a ny significant difference between growth of Tier 3 terms compared to Tier 1 terms. There is no pattern that we can see there.

Okay. Just one follow-up on the experience. I think I remember just one of your peers they observed the last 2 years' experience before making any changes to the assumptions. So is it last 2 years experience for you as well or you wait for more years before changing any assumptions?

So we do take some longer period to ensure that our experience that we are go ing to use are assumptions safely is the credible enough. Now credible enough will also depend on the exposure of those lines of business, as we said that. But our view is not to make year -on-year changes. Our view is to make an assumption, which is sustainable for a longer period of time, and to some extent is a prudent seller. And second point, just to add to your question on this. When you look at the economic assumptions, EV and other. Other part is if you read this chart the economic assumptions for EV is not only economic assumption, it's also in cludes most of the economic variance and most of the things are coming on account of economic variance. That you expect it will return a much more than what you expected in the yield curve.

Okay. Got it. Thank you so much.

Thank you. Our next question is from the line of Anirudh Shetty from Solidarity Advisors Private Limited. Please go ahead.

Thanks for the opportunity. So my first question is around the GTI business. You shared the APE figure for FY '24, could you share that for the FY '23 as well?

Got it. And sir, this business while we're calculating our VNB for this, do we assume it to be a yearly sort of business o r do we also make an assumption that the business could get renewed and so we kind of take it on a more multiyear type of recognition?

We use this is a yearly renewal business and this is a very lumpy business. This year, it is with you, next year might be gone to other thing and particularly as a company we try to acquire or renew the business from a profitable type of things . So we always assume this is one year business.

And sir on the individual protection business you explained some challenges there this year because of ULIP doing well. But aren't the products serving very, very different needs, so was the challenge more from the customer demand side or was it more from the push side, from the distribution side where in they prioritized pushing ULIP?

So there is no change from the push side. We want to offer all our products to all our customers and we provide all solutions for every life stage cycle of the customer. It is customers' choice. And as I told earlier also in response to some other question, this year, the flavor was ULIP because of excellent performance of the stock market. So people preferred and were attracted to the equity returns. The kitty of investable surplus with the people is same. So if they are preferring ULIP, obviously, the other line of business, the share goes down. But from the company side, our focus is on all the products and we offer all the products that lay out in front of the customers.

Got it. And just one final question is when you think about the opportunity within. You had mentioned 2% penetration. Is that just for insurance or for all our savings products put together and you had also mentioned more -- the target customer, someone with -- correct me if I'm wrong, but more than INR10,000 savings balance. So I just want to understand that how did you -- how have we arrived at this INR10,000 saving balances a potential customer?

So that basically is SBI's internal data, and they run internal data analytics. That is what they have informed us. We don't have that customer list with us. That is the data analytics that SBI runs. And this 2% is for all the products, not only the protection product, for all products that we offer through SBI branches.

Thank you. The next question is from the line of Punit Bahlani from Macquarie Capital. Please go ahead.

So just on an APE growth basis. Your peers have said that t hey are expecting APE growth in line with industry level, but what would be your expectation sir? I know you don't want to give an explicit guidance, but will we be expecting higher than industry growth or in the high teens or what are your comments?

Right.

See, if you have seen our trend in the past and current year also, we have been better off as compared to the industry within the industry also among the private players. And we will try to maintain that position going forward. And as we have mentioned, the growth trajectory will be similar what we have been seeing in this year and we'll continue to focus on the leadership as far as the private industry is concerned.

Got it. And sir, just confirming one thing on the margins front, you highlighted that going forward, growth will be driven by an improvement in the protection mix , you do expect further levers for margin expansion, right?

There is a probability because it depends on the product mix. If this switch will happen from ULIP to non-ULIP. So expectation is that if it goes as per the plan then there will be a positive shift in the margin.

Okay. Thank you sir.

Thank you. The next question is from the line of Roshan Chutkey from ICICI Prudential. Please go ahead.

Thanks for taking my question. Just wanted to understand from a regulatory standpoint, what do you worry now? How should one think about it?

I think worry is the wrong word. Our regulator, the sector regulator is very active and he is taking , the regulator is taking all the r ight steps for improving the i nsurance penetration, overall sum assured , taking care of long -term, short -term customers , everybody. So we don't feel any challenge. The regulator is working for the customer satisfaction and the company's policy fully aligns with the regulator's policy.

Thank you.

Thank you Roshan.

Thank you. Ladies and gentlemen, we would take that as our last question for today. I would now like to hand the conference over to Mr. Amit Jhingran for closing comments.

So thank you very much everybody who was here and we had very fruitful discussions and the insights into the industry. I thank you again for all the time and all the queries. I hope we have provided you with satisfactory answe rs. If you need any clarification, you can reach to our Investor Relations Department and we will be happy to satisfy any other queries regarding it. Thank you. Good bless you all.

Thank you, members of the management. On behalf of SBI Life Insu rance Company, that concludes this conference. Thank you for joining us. You may now disconnect your lines. 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 subjec t 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.