SBI Life Insurance Company Limited ($SBILIFE)

Ladies and gentlemen, good day, and welcome to the SBI Life Insurance Company Limited Q4 FY '26 Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Amit Jhingran, Managing Director and CEO, SBI Life, for his opening remarks. Thank you, and over to you, sir.

Good afternoon, everyone. It is a pleasure to welcome you all for the results update call of SBI Life Insurance for the year ended March 31, 2026. We appreciate and thank you for your valuable time and efforts in analyzing the results and participating in the earnings call. Updates on our financial results are available on our website as well as on the website of both the stock exchanges. Along with me, Mr. Sangramjit Sarangi, President and CFO; Shri [indiscernible], President, [indiscernible] Strategy; Shri Subhendu Bal, President and Chief Risk Officer; Shri [indiscernible], President and Appointed Actuary; and Ms. Smita Verma, Senior Vice President, Finance; and Investor Relations are present here. SBI Life delivered a strong performance during the year, demonstrating resilience in a dynamic operating environment. This was supported by a balanced approach to both product and distribution mix. The company maintained an optimal blend of protection and savings products aligned with the evolving customer needs. While leveraging a well-diversified multichannel distribution strategy, expanding bank assurance, agency and digital platforms. This enables consistent and broad-based growth across segments. The AR marked a significant pace for the life insurance industry, driven by key regulatory developments, including GST exemptions, major supporting long-term sectoral growth and the regulator's announcement on transitioning to the Indian Accounting Standards framework aimed at enhancing transparency and quality of financial information. The company has adopted a phased and well-governed approach to in as transition and proposes to seek regulatory for adoption from April 1, 2027, with comprehensive preparatory measures already initiated. Looking ahead, the company remains confident in the long-term growth potential of the life insurance sector in India and its ability to navigate a the evolving landscape with continued focus on profitable and sustainable growth. Now let me give you some key highlights for the year ended 31st March 2026. New business premium stands at INR 425.5 billion with a growth of 20% and private market share of 21.4%. We Individual rated new business premium stands at INR 219 billion, with a growth of 13% and private market share of 22.9%. Gross written premium stands at INR 112.9 billion, with a growth of 19%. Profit after tax for the current year grew by 2% standing at INR 24.7 billion as compared to the previous year. Value of new business stands at INR 66.7 million with a growth of 12%. VoNB margin stands at 27.5% for the year ended March 31, 2026. Indian embedded value for the company as on March 31, 2026, stands at INR 87.9 billion. Our assets under management stands at INR 4.9 trillion with a growth of 9% over last year. Solvency ratio of 1.90 as against the regulatory requirement of 1.50. We will now update you on each of the key parameters in detail. Let me start with the premium. Individual rated premium stands at INR 219 billion with a year-on-year growth of 13% while retaining our leadership position with a 22.9% private market share and 16.5% total market share. It grew by 12.9% 3-year CAGR, outperforming the industry average of 8.5%. Total new business premium is INR 425.5 billion with private market share standing at 21.4% and total market share standing at 9.3%. Group new business premium stands at INR 127.7 billion with a contribution of 30% in new business premium and year-on-year growth of 39%. Renewal premium grew by 19% to INR 587.3 billion, which accounts for 58% of the gross written premium. To sum up, gross written premium stands at INR 1,012.9 billion with a growth of 19% over corresponding previous year. Annualized premium equate APE stands at INR 242.7 billion, registering a growth of 13%. Out of this, individual APE stands at INR 221.1 billion with a growth of 13%. During the year, a total of 22.2 lakh new policies were sold [indiscernible] 22.7 million lives. The growth [indiscernible] reflects strong consumer confidence and increasing awareness of financial protection. Individual and Group New business [indiscernible] grew by 61% and 34%, respectively, year-on-year, while riders have issued continue to expect now accounting for 31% of individual sum issued. The company continues to advance its product diversification strategy through focus and well-sequenced initiatives. During year, product launches were aligned to key customer needs across Kaplan, protection solution and the non-par guaranteed segment, resulting in encouraging traction. For the year ended March 2026, guaranteed non-par savings have garnered business of INR 42.7 million with a contribution of 19% on individual APE basis. ULIP stands at INR 144.2 billion, contributing 65% vis-a-vis 70% last year. Protection business contributes 9% of APE and stands at INR 22.4 billion. We continue to maintain a strong focus on production business, which remains a key pillar of our growth strategy. The Protection segment recorded a year-on-year growth of 10% on APE basis. Individual protection APE is at INR 10.3 billion with a growth of 24% as compared to the previous year ended March 2025. It is noteworthy that the pure protection category saw a strong growth of 122% on an individual APE basis, reflecting rising awareness and demand for comprehensive financial protection, while the individuals [indiscernible] in the protection segment grew by 62%. Group Protection APE stands at INR 12.1 billion. Credit life APE has grown by 14% and stands at INR 2.9 billion. Individual APE for participating products stands at INR 17.3 billion with an exceptional growth of 133% Y-o-Y. Also, Par segment sum has shown a strong growth of 166%. Retirement plans assist customers in building a substantial corpus of funds to maintain the desired lifestyle and manage expenses in their golden years. Total annuity and pension new business underwritten by the company is INR 86.5 billion. Moving to update on our distribution partners with a strength of more than 59,000 CIFs, the bancassurance business of SBI and RRDs contribute 60% of the total APE business. On an individual APE basis, it stands at INR 141.2 billion, reflecting growth of 11%. SBI branch productivity on individual APE stand individual APE terms stands at INR 6.0 million for the year, registering a growth of 10%. As on 31st March, 2026, [indiscernible] individual APE stood at INR 68.6 billion, growing 15% with agent productivity at 2.6 lakhs. The channel witnessed a shift in product mix. Non-ULIP share increased from 34% to 39% for FY '26, supported by robust 76% growth in agency individuals from issued. The company added more than [ 1,20,000 ] agents on a gross basis. We opened 120 new branches this year. This expansion is aligned with our vision to create infrastructure that supports the long-term development of our agency channel. The other channels, direct, corporate agents, other bank brokers, online and web aggregators grew by 22% and contributed 11% of total APE. Banks other than SBI Group are also growing at 22% on total APE basis. We are investing in building our online business channel. For the current year, this channel has grown by 47% on APE basis. Moving to updates on profitability. Our financial performance reflects the impact of GST and the revised labor law. Taking these factors into account, the company's profit after tax for the year ended 31st March, 2026, stands at INR 24.7 billion. Excluding this impact, profit after tax for the year ended 31st March, 2026, would have stood at INR 31.2 billion with a growth of 29%. Our solvency ratio remains strong at 1.90 as against regulatory requirement of 1.50. Value of new business stands at INR 66.7 billion, reflecting 12% growth driven by both volume growth and favorable shift in product mix. Despite the impact of Jesse, we have sustained a healthy margin of 27.5% for the year ended 31st March, 2026. Excluding GST impact, VoNB would have been 70.3 billion, representing 18% growth with a VoNB margin of 29%, an improvement of 150 basis points. Embedded value for the company as on March 31, 2026, stands at INR 87.9 billion with a growth of 15% over previous year. Excluding the onetime impact, EV stands at INR 813.6 billion with a growth of [ 16% ] return on embedded value stands at 19.7% with embedded value operating profit standing at INR 138.6 billion. Coming to operational efficiencies. Our OpEx ratio stands at 6.1%, and total cost ratio stands at 10.6% for the year ended March 31, 2026, as compared to 5.3% and 9.7%, respectively, for the year ended March 31, 2025. With respect to persistency of individual regular premium, 13th and 49-month persistency stands at 87.9% and 69.1%, showing an improvement of 53 and 107 basis points, respectively. As mentioned in my opening remarks, [indiscernible] under management stand at INR 4.9 trillion as at March 31, having growth at 9%. Net CM settlement ratio stands at 99.4% for the year ended March 31, 2026. Our [ mis-selling ] ratio stands at 0.02%, which is 1 of the lowest in the private industry, and this is achieved through our consistent approach adopted at the company to ensure right selling to the customers. Digitalization is transforming the life insurance industry, enabling us to deliver enhanced services and a more seamless experience to our customers. As we embrace the digital transformation, we remain committed to innovation and excellence ensuring that we stay ahead in an increasingly competitive landscape. The company continues efficient usage of technology or simplification of processes with 99.7% of the individual proposals being submitted digitally. 57% of the individual policies are processed through automated underwriting. In conclusion, by embedding resilience and continuous improvement at the core of our culture, and by strategically strengthening our key channels, we are well positioned for sustained growth. Our unwavering commitment to delivering exceptional customer service not only deepens client relationships but also enforces our reputation as a trusted and leading force in the market. Thank you all. And now we are happy to take any questions that you may have.

[Operator Instructions] Our first question comes from the line of Avinash Singh from Emkay Global.

Congrats on a great set of numbers. A couple of questions. On the first one, if I see persistency has done well across the cohort barring 61st month where it has seen a drop likely it would be coming out of some ULIP during the COVID time, the policy is sold. And possibly, that is the [indiscernible]. But on that context -- in that context, I wanted to know is that operating agents and changes that are kind of a negative in the walk. Are they kind of leading to some bit of a reset in [indiscernible] or there are other factors behind this marginal operating changes. So that's one. Second, again, if I look back how kind of you have delivered over the last 10 years and you have presented in the slide, I mean, in terms of your market share or individual APE market share or [indiscernible]. But if we -- again, we were to look back those 10 years and break it into 5 and5, what should be the first 5, of course, coming from a lower base, had a very, very strong growth on all parameters, including the kind of a margin expansion and all. Now if we look back now where the margin is more or less stable, but expansion part is difficult and of course, the base of growth and everything in the future. The growth is also going to be measured. In this backdrop, if I kind of want to ask, I mean, what would be your experience over the next 5 years? Again, I'm not coming off to quarterly volatility. But if I'm saying that, okay, what would be the number in terms of your retail APU growth or kind of where the [indiscernible] or margins will come on for the next 5 years, what would you have to say.

And the first question to [indiscernible]. You're right that there is a process to drop on account of the business done in the COVID period, so we know that. is concerned, we -- as we already said that we keep this exceptional items separately and look into the long-term view. So as we always keep mentioning that year end, we keep refine our [indiscernible] looking to reflect the current experience. So there are some changes in the mortality, some of the persons, some improvement coming on account of the long-term [indiscernible] of the person. So that's reflecting the name. But this 50 basis point is not a significant point. So I will say there are no significant change with them, sir. It's a combination or minor refinement across all the sums, including demographic as well as expenses partners.

Coming to growth prospects, you are aware that the company 3-year CAGR is at 12.9%. And last financial year, we have grown by [indiscernible] going forward also, we intend to maintain the growth rate at around 14%, which is has been our CAGR for the last 3 to 5 years. And we will continue to maintain this kind of growth rate in coming years also.

And lastly, if I can ask one more. I mean, in this part, of course, in your mix, it is still a smaller portion. But typically, you have been more like a [ ULIP ] protection and guaranteed on path. What is -- I mean you're kind of your own intent or what is the demand factor that you kind of bring in this strong growth in par?

The par product portfolio growth of this year has come on a lower base of the last year. Last year, we had just a couple of products. This year, we launched new products in the power category, and we got very good customer response in this category. That has resulted in a very robust growth in the Par segment in the current year. We have been. Company which had dominant sales of ULIP in the past. But as you are aware, you have been attending these analyst meet for the last couple of years. However, focus has been to improve the product mix in favor of non-ULIP products also. And if you look at the product launches in the last couple of years. We have very good product launches in all 3 non-par segment power segment and also in the protection segment. So this is our effort to improve the profitability of the company also by having a healthy product mix. And we are happy that our strategy and our product launches are helping achieve this objective.

Our next question comes from the line of Supratim Datta from Jefferies.

Can you hear me?

Can you please be louder?

Yes. Is this better?

Yes.

My first question is on what are you seeing with respect to customer behavior over the last 2 months, given you have been typically a ULIP-heavy company and last too much you've seen pretty significant volatility in the equity markets. Just wanted to understand how are customers reacting to that volatility? And how is that shaping ULIP demand? And how in this environment ends looking into FY '27, how are you thinking about the product mix and product strategy, given you have a growth aspiration of 14% like you highlighted. So that's the first question. Second, again, like you rightly pointed out at the start that you have been looking at changing the product mix for the last 2 years in favor of non-par products. Just wanted to understand what is the share of protection now within SBI Bank versus 2 years back? And what proportion of these policies overall in the SBI channel are being sourced through. If you could give us some color there, that would be very helpful.

So talking about the customer behavior in the last couple of months there -- you are aware, the geopolitical events that are taking place. And that definitely is having some impact on the market on the performance of the equity market also and the effect seen on the fixed income side also. But at the same time, if you look at the equity market, there are robust inflows into the mutual funds also. And overall, people wherever they are seeing value they are investing. That is what we have seen in the company. Our growth in February and March has been decent enough, and we have been able to meet our guidance for the year despite these events. So going forward also, we expect to continue to have good sales growth in the coming quarter and coming year as well, depending, of course, upon month-to-month variation and we do not pay much attention to month-to-month, and we like to keep our focus on our early goals and midterm goals. So that is regarding your first question.

Our share is 4%, 4% of shares for [indiscernible], credit client is over and above that. And broadly, that number has been flat but the mix has changed favorably from TROP towards higher proportion of pure protection. So the premium numbers are not seen as a proportion, obviously, absolute numbers have grown but share has remained broadly constant, but I'm assured we have seen significantly higher [indiscernible]

Number of policies.

Number of policies in some assured basically because [indiscernible] protection will have significantly higher share.

Understood. And if I could ask one last question. So on the ULIP side, are you selling the higher summer [indiscernible] the 2030, some assured products? Or is it -- you're selling only the vanilla 10x cover products? If you could give us some clarity there.

As of now, we do not have hired some assured ULIPs.

Okay. But do you plan for launch that?

We will look at the opportunity and decide in due course.

Our question comes from the line of Shreya Shivani from Nomura.

I had 2 questions. First is on the banca channel sales in the last quarter, in the fourth quarter. It's actually degrown Y-o-Y. Is it to do with the fact that March have been -- March was a slower month for us. Was it coming from that? Or was there any other reason? Second question is there was a media interview by the [indiscernible] Financial Services Secretary, where he's yet again raised the topic of banks should be open architecture, et cetera, et cetera. Do we have -- is there anything you can share with us? Because obviously, it's a big part of our distribution mix? And also, what is our strategy on the distribution channel in case such a decision is finally taken by or mandated by the government.

First, talking about the Q4 that you would have noticed that the entire insurance sector had a sluggish kind of Q4, and that may be related to various events taking place geopolitically across globe. And our growth coming to our growth in Q4, as I already said that instead of looking month-to-month and quarter-to-quarter growth, we like to focus on the annual numbers and we are happy that we have been able to meet more or less our annual guidance of 13%. We have maintained our 3-year CAGR slightly higher than that, in fact. And banca channel also has been able to meet our internal budget of set for the year.

Regarding your other query, I would like to emphasize that SBI Life is now a 25-year-old company. And in this long journey, we have established various very robust system and procedure. And we have seen various regulatory changes coming at different point of time. You will appreciate that the company has been able to navigate all these regulatory changes with ease and we have been growing at a consistent rate. We are not aware about this particular topic as of now. But we are very sure that any regulatory changes, we will be able to meet with a robust response.

Right. And sir, any -- just strategy on other channels I know you've added a lot of new branches. But on the other line item, what are the channels we would incrementally be focused on irrespective of what happens with the bank?

So agency channel, for the last 2 years, we have been strengthening a lot. And in fact, the contribution of agency channel in our distribution mix has improved in the last couple of years. In addition to the agency channel, where we are open more number of branches, adding more agents having better productivity. We are also focusing upon our emerging business channel, although as of now, it is a small channel, but the growth rate and the investment being made in this particular channel are giving us good rule. We will continue to invest in our direct channel on our website direct channel sales. And we are sure that this is also going to be a good formidable force in coming future.

Our next question comes from the line of Prayesh Jain from Motilal Oswal Financial Services.

A few questions. Firstly, just extending the previous question. Is there -- has there been any communication from [indiscernible] in any form about open architecture or in form of offering more products at the bancassurance channel because interview kind of stated that that there has been some communication or requests gone to the banks to adopt the open architecture. Second is, if I look at your cost ratio, right, from FY '24 your OpEx was at 4.9% has gone up to 6.1%. Total was 8.9% has gone up to 10.6%. And within that main thing, I think the product mix has [indiscernible] to a certain extent, but also you have opened more branches and the agency channel has seen a really stronger growth. So how do you see the cost ratios moving from here on whether there is any -- do you think that you would be capped at 10.6% or this ratio will kind of keep moving higher? And thirdly earlier, while you talk about a 14% kind of APE growth, what would be your thoughts on margins going ahead with VNB margins going ahead? Those are my 3 questions.

So RBI guidelines are draft guidelines, in fact, are in public domain for last couple of months, and they are supposed to come in force from 1st of July. -- does not talk of open architecture. And we do not have any additional information other than what is in the public domain. As far as cost ratio is concerned, the impact on cost in this particular year last financial year is substantially coming from the GST impact. As I already talked in my opening remarks. The other factors regarding opening more number of branches, having higher IT spend for customer ease and the other processes and spend on training our agency force and our CIF, et cetera, those are the regions which have resulted in slightly higher cost ratios. But going forward, I think these things have already panned out. And other than strengthening IT, there is no other major expense plan in the near future.

Sir, just extending that question. So GST is now kind of -- GST is not onetime, right? GST is going to be there for some time -- it's a permanent thing, right, unless we kind of really do some cost savings, which will bring down our costs, right. So from that perspective, how do you see the cost ratio? And my last question was on VNB margin trajectory going ahead?

Second [indiscernible] what I said that now the GST is already in this cost of 10.8%. So that has already built in. we do not see costs going higher on account of this particular thing. Prithesh, would you like to talk about the margin?

So I think the margin also, if you see we have reflected high margin already accounted for all the impact of GST. And last time also you mentioned that we working to enhance the product mix and profile mix. And we are very sure that provide enhancement in the profile, which we're able to absorb this impact of GST. So even if you see the [indiscernible] closely, we have offset. So the beta product makes some benefits coming from the interest moment has able to offset this impact of GST. So that's reason 27.5% we're reflecting into. As MD sir also mentioned that [indiscernible] reflected. And we are looking to [indiscernible] from current level with a growth of 18%. So we expect that our margin will be continue to be a similar range that we maintain about 26% to 28% range that we're seeing. And our interview is to report the margin of 27% kind of [indiscernible]

You will appreciate that despite the GST impact and other onetime impacts, we have been able to report VoNB margin at the higher end of the range of 26% to 28% that we had set at the start of the financial year. So we stuck to overran and we will continue to maintain that kind of market in coming years.

Absolutely commendable sir there, but with all the costs with all the onetime impacts in the margins in this year and now we're moving more favorably to wanting to move our product met more favorably, should we shift our guidance to '27 to '29 versus 26 to '28.

So I think we said '27 to '28, and we will stick to that.

Our next question is from the line of Madhukar Ladha from JPMorgan.

Congratulations on good numbers in a sort of difficult operating environment. First question, in the EV walk, we see a very strong positive operating variance. If you can quantify how much is expenses, persistency and mortality. And if we have such a strong positive valance, then why are we strengthening our assumptions in the VNB. So I wanted to get a better sense of why are we seeing this divergence in EV and then in VNB. And second, so our solvency is now at about 190%. We work at 180% solvency. So in terms of capital, what are your thoughts, any additional need? And how will you sort of bridge that gap if required? Yes, those would be my 2 questions.

First on your question on the EV work that we already mentioned that as a company, we say our [indiscernible] always have the longer term view, and we ensure that [indiscernible] in longer term. I just always give us a very [indiscernible] if you see year-on-year, we keep reporting the [indiscernible] we have quality of businesses. And this is not coming because we are using different conservative ARPU in terms of because our quality of business is effectively much better than what we're looking to. So if I say most of the quality [indiscernible] coming on account of [indiscernible] [indiscernible] 0.2% is not a significant strengthening app. And we appreciate that the products that we are currently selling in the new business. And what has been affecting our existing book, both are significantly as slightly different, is not exactly same. -- it may not be fair to correlate the assumptions in the PV with that operating variance in generally reflective. So there are maybe 1 or 2 product lines which we have tried to increase our promote. They're minus refining we did in the unfound that's also, I will say, a very emerging trends. And as a company, we always look into and [indiscernible]. So that's [indiscernible]

As far as solvency is concerned, you see the company is generating good cash accruals and strengthening its capital base through internal accruals. So only we have not raised any fresh capital for strengthening our margin. And this is efficient use of capital that is resulting in solvency of 1.90 against the regulatory requirement of 1.50. Going forward, we are assessing the impact of the AS and RBC also that is been discussed at the regulator regulatory limit for introduction in near future. So we are keeping a very sharp eye and we will take appropriate call at appropriate time.

Just one final follow-up. Can you split the economic widens between your debt and equity?

So see, our economic variance is more or less the sensitivity that we spend in EBIT. So majorly, you see the equity fall, and so major share coming from the equity and other part is turning from the bond. So if you total 3.66%, if you say around 2.15% is coming from the equity and balance sheet from the bond.

Our next question is from the line of Sanketh Godha from Avendus Spark.

Sir, you said that our growth most likely will be in the range of 14-odd percentage for next few years. But if I look at your banca growth maybe for last 3 years, it has been stuck in the range of 9 to 11 odd percentage. So just wanted to understand if the 14% growth has to be delivered, then there should be a heavy lifting of the growth from the other channels, either agency or other relationships? Sir, just wanted to understand if you want to give a color of the 14 -- that 11% trend to continuing bank and it will be largely driven by the other channels in a way to drive the growth? That's my first question, sir.

As already being guided for last 2 years, we have been telling that we are strengthening our agency channel by opening more number of branches by having more agents by improving agent productivity, et cetera. So the clear focus is on further strengthening the agency channel and tapping all the opportunities that are available in this particular channel. We already have a robust share of agency business in the industry, and we want to further strengthen it. We have also guided that in the distribution mix also, we would like to have greater share of agency channel, and that is already taking place if you look at the distribution mix in the last couple of years. So this 14% will be an optimum mix of the agency growth and the bank.

Sir, then is it fair to say that the bank a growth in the range of 10% to 11% is the realistic number going ahead for us?

I mean we do not diverge the different channels, growth targets as such. But this is the kind of base that we have been growing in despite all the substances and all, and you can say that...

For the reason I'm asking -- yes, sir, the reason I'm asking this question is that if I assume the nominal GDP growth or inflation-led growth, with the natural increase in the ticket size, that will be in the range of 8 to 10 percentage which means that a penetration in the banca channel largely being achieved the growth in banca will be predominantly driven by the ticket size increase. That's the reason I was asking that more realistic growth penetration being largely achieved, it's more ticket size led growth like 8 to 10 percentage or 10% to 11% is kind of a number.

No. Our focus is also on the protection side. So I will not say that the growth is coming only from the ticket size increase. If you look at the number of policies also -- the production segment is growing where the ticket size is very small. And there also, we are getting substantial number of policies that has resulted in good production growth also. So we do not look at from quarter-to-quarter and month-to-month number, but we set our annual targets and medium-term targets and go around doing business on those lines. .

[indiscernible] to further strengthen the penetration of customer base of bank. We are not saying we have saturated the customer base of [indiscernible] Yes, opportunities there, and we are tapping all the available opportunities in the best possible.

Understood, sir. And my second question is, again, on the margin. Sir, at the start of the year, you guided 26% to 28%. But at the start of the year, you did not have a GST impact. But if you -- if I negate the GST impact, you actually ended up reporting 29 instead of 27.5%, which means you under guided probably on the margin. So just wanted to understand. [indiscernible], what you're trying to guide now has an upside either because of the product mix or cost levers to play out in the next year?

So this is a matter of perception, you can say under guided or you can say over delivered. This is a matter of perception only.

So the realistic margins may be better than 28% is what I wanted to check rather than being a little conservative in the sense.

So no, it's not able to conservative. So you see the only reason to to deliver this margin despite the GST impact is as a company, we are working to improve the product mix that's really -- that's the reason we are able to have almost the heat on the margin. While giving the higher range is, as you said, with the higher base, we have tried to grow with the 14%. And at the same time, we are try to achieve the better product mix. So making a combination that product mix, which give a better margin and a better as well as maintain that 14% growth is such a high value, it's not a very Asia task, and that's the range that we give. It gives us some flexibility to play around to maintain the good growth rate as a maintained the margin. That's we try to do that. It is a matter that we are giving a [indiscernible] guidance [indiscernible].

So book growth profitability, we keep a very sharp eye and we adjust accordingly.

Understood, sir. And lastly, sir, 2 things. One is, in protection, can you give your premium mix [indiscernible], broken down into pure term [indiscernible] and the whether the [indiscernible] as a product has seen a natural lower demand because of the GST benefit, which is available in [indiscernible] to RWRP. That's one thing. And second, last time in the call, you said that you were working on regarded annuity plan. If you can give a bit of guidance or color of how far you have come to the product, whether you are hoping to launch that particular part in the current year or not?

So we -- our individual to launch this different product in this quarter resell. So we are aiming to go to -- by June, we should launch a different. Otherwise, we'll go to the next quarter.

Understood, sir. And then on the protection side, sir?

Protection side, the number will give off-line to you.

Our next question is from the line of Shobhit Sharma from HDFC Securities Limited.

Congrats on a great set of numbers. Sir, my first question is on your agency channel. That channel has consistently grown year-on-year for the last 2, 3 years and have provided stability to your overall growth. what gives you the confidence? I understand you mentioned about the new agent additions and the new opening of the branches. So can you give us some color around these agents who have been recruited? Are these from the industry? Or are these new to the insurance business? And secondly, if you can give us some qualitative comments about the branches, which has been opened last 2, 3 years, what is the business contributed by them? Or if you can give some color around the contribution of these newly hired agents over the last 2, 3 years?

Since we are new to the insurance industry, there is no open architecture on the agency side. So we have a very robust system of hiring and training agents, and we are happy that the agent increase is also being equally met with the agent productivity. So the good growth number is coming both from the side of increased number of agents as well as increased productivity. So as I already said that we want to tap the opportunities available on the agency side. We are happy that today, we have one of the strongest agency force in the market. in the private industry and the largest player also. A substantial portion of the industry mobilization is coming through SBI Life. We'll continue to focus on this particular channel and our training methods to our agents to further tap the opportunities that are available here.

Sir, any number around the business contribution from the branches which you opened in the last 2, 3 years on the contribution of agents whose vintage is less than 3 years?

We do not disclose those kind of numbers, and you will appreciate that, of course, any branch which is newly opened, it takes some time to breakeven, but these branches are well on track. We are satisfied with the contribution that is coming through these branches.

Okay. Sir, second question is on your [indiscernible]. So over the last 3 years, we have not seen the NOP count growing on the usual business side. We had seen a very strong growth in Q3 beyond the NOP. But in Q4, again, it has turned negative. So when can we expect our growth to be led by [indiscernible] of the growth in the ticket sizes. And last question is on the GST impact. So I believe that the GST impact which we have seen during this year was actually a permanent -- I was really permanent in nature and we would have made changes in our actual assumptions. So how should we think about the impact from next year onwards? Should we see a similar kind of impact of 1.5% on an overall margins? Or it would be on a higher side because this year, we had an impact for only the second half primarily.

So see, GST impact has already accounted for in the margin the 27.5. Only -- and this is part of the business [indiscernible] 2nd September. So maybe next another half year, we'll see some impact. But I think this is more or less similar level for the 6 months. Overall and that we have adjusted, and we are working to do that product mix profile for that offset that. that's the reason we're saying with the GST impact considering into reflecting our cost and all, we are able to deliver the margin that we've just given the guidance of 22% to 20% range. So there was no adverse impact going to be reflected on account of [indiscernible] so that's so far on GST, basically a sense of the import cash, we are observing the commission [indiscernible] commission of [indiscernible]. So that's already reflected in that.

Okay. And on the NOP side?

I think NOP we are giving listing, and we are hoping that once we come with the deferred net part that also will help us to some of the because we appreciate the single PM annuity most of the high ticket size, but when you come to the deferred regular analogy, I think ticket size will be much lower than single premium and early people will buy these things. So we expect that will help us not only to grow the net business. also increase the number of [indiscernible].

So you mean to say NOP growth next year would be driven by the annuity products, which we'll be launching in this quarter or the next quarter

No, we are not saying that. We are saying that will help us to increase overall business. [indiscernible] I see we have the complete suit of the net. We have a different entity in single PM. We are -- we have the immediate annuity. And where we have the NPS [indiscernible] and within the it offers a certain option. Now we are lagging only on the regular pay a different entity. So by [indiscernible] will have a complete suite of entity product viable to the customer, and we expect that [indiscernible] should help us to grow this line of business.

I think the confusion is he is talking about NOP, not only [indiscernible] overall NOP also increase through other products and protection products will especially help in increasing the number of.

Our next question is from the line of Dipanjan Ghosh from Citi.

So my first question on the VNB mix. I know that you don't give the margins across channels and every channel has a different product mix. But let's say if you were to FY '23 for the last 2 years and assume a similar product mix, channel mix, cost structure, what would be the contribution across some of these channels or some qualitative color in terms of divergence between APE mix and VNB mix across than, at least qualitatively? The second question is on the Credit Protect business for FY '26. The growth seems to be a little bit on the softer side. So going into next year, I just wanted to get some color on what are the attachment rates at SBI? Or what are the efforts that you're really undertaking to grow this business because it's a relatively high-margin business, I would assume. And finally, the third question is on the operating releases. Now if I look at the last 10 years, ex of COVID, I mean, in almost all the years, you would have delivered a positive release. So just in terms of the assumptions that you have built in the back book transitioning to IFRS and I understand you are taking the [indiscernible] but does it sort of robust risk management or prudent underwriting that would have done give you any sort of benefit relative to any other company who should have probably taken a differentiated strategy on these assumptions. And one question on the data keeping question. If you can break the operating variance into mortality, persistency and expense others?

So I will start with the last question. I think that I explain that most of the operating variance is coming on account of the mortality and percent and leading on the expenses, [indiscernible] Second, your question to the channel right margin, we don't disclose that and we don't look into the specific -- we don't [indiscernible] particularly the product mix with the particular channel offer the products to all then we pay the similar commission to the different channels. And do that. And that's the reason we don't disclose this and even don't look into those on a margin perspective or that we generate, I think because we look into the longer term and company-level margin accretion on that. Third question, if I remember correctly, your [indiscernible]. I think that I mentioned earlier, most of the operating party variance over the years, including the [indiscernible] reflect the 2 state of things. One is the quality of business the company is writing and the underwriting in [indiscernible] part. So if you write a better quality of business, you will expect the experience will be much better. Secondly, also look into how you see your sustainability in the longer term. So when you set the assumption we take a longer-term view. And each and every time we see that whenever we see the credible experience emerging and just mandate to review our assumption modify with [indiscernible] So even last year, we have capitalized quite a few particularly by the percent side, we capitalized some of the assumption and that region this year, the percent slightly lower to that. And we will continue to do that. Our view is to report the numbers and view it to not on the pricing and reporting as well, keep it longer term sustainable to give on that perspective. So this is a third question. I don't want to comment how this will play out in to us and how is the other in the market. We normally are comparing our performance versus others. But definitely, a company is having the longer-term subscribe assumption that will have the better place, and that will also reflect in IFRS [indiscernible]

And the bank credit line, we think 14% is reasonable growth is faster than the bank's [indiscernible]. We have increased our attachment in home loans by [ substantial amount ]

Or just a small follow-up. If I heard correctly, you mentioned that your persistency area this year is a little lower than last year. And I think last year, you were around INR 2.5 billion to INR 3 billion. So that basically means that for this year, you almost had like INR 8 million, INR 9 million of positive reality [indiscernible] that right to understand?

No, I'm not saying that. What I tried to tell you that each and every time whenever we see the credible experience and continuous parity variants coming into that will revise and do that. And when you revise you will get certain GAAP and [indiscernible] Nothing else.

[Operator Instructions] Our next question comes from the line of Neeraj Toshniwal from UBS.

Just a follow-up on the credit life. This quarter, we see a big impact on the group credit. It's largely coming from GTI. Is the right understanding? Or how is the creative ended quarter-on-quarter and Y-o-Y this quarter?

No, this quarter, the GTI business has come as compared to the credit life. So that is the reason the quarter 4 growth in the group credit group business has actually gone up.

Okay. And do we have numbers on how much is [indiscernible] and how much is [indiscernible]?

No. Quarterly, I don't have a number. We will give you separately.

Okay. And on the target mix, I think we have been mentioned that we will be likely around 60, 40, 60, 40 non-leader. I think we've only kind of achieved that deleting remains stable in terms of an anal coming out between [indiscernible] is not fair understanding? Or we can further see [indiscernible]

No, we are driving at already in the initial remarks, MDs commented that we are driving for a right product mix in the longer run perspective. So today, we are at 66%, depending upon the market, depending the customer's choice, we are offering the products across geographies. So we will continue to drive the better productivity or a balanced product mix rather going forward. So we will see how the experience will evolve. But yes, we are looking into the better product mix going forward.

Okay. I was coming from , but I think it's already 59% when that's coming from [indiscernible].

[indiscernible] That is 66%.

On [indiscernible] are you taking or not taking any so I kind of like others have been recouping of the GST back? What is our strategy here because growth, while everybody has seen decline or decline has been a little moderate compared to peers? Any commentary here or the strategy going forward.

So I think a par, if I say correctly your question on the NAPA IRR perspective. So I think we continue to look into the interest rate movement and reprice the par. I think currently, if you see the there a lot of volatility, the curve, and [indiscernible] But in the meantime, we have launched a new non-par products that replaced our existing non-par products, and that reflects the current yield. So to some extent, we have passed on this some benefit to the customer by launching this new product will continue monitoring and regular money that I keep saying that the company will keep doing this adopting the dynamic approach in [indiscernible] is concerned. And this is -- whenever we see this [indiscernible] reprice and pass on to the benefit to the customers. So we try to balance between those.

The next question is from the line of Nidhesh Jain from Investec.

The question is on VNB margin. So if you look at the full year VNB margin, there is a 150 basis point impact of GST. So that is for half year. So does it mean that for the full year, the impact would be around 300 basis points and are starting margin, let's say, on a back-to-back basis, it's 26% if the GST would have been implemented for the full year, which means that we have to show we margin expansion from 26% in FY '20. So that is the first question.

No, not the case. So if you see the business written for September is much higher than the Secondly, that we mentioned when we declared the result on September, we have already incorporated the impact in terms of the commissions and the renewal commission for the business retained prior to the 22nd September as all. So if I summarize, I say that all the business return after 22nd September, the GST impact [indiscernible] commission reflect both a commission renewal. And the business return prior to 22nd September, the GST impact on commission and renewal. Thirdly, we have incorporated the expenses extra expenses, including GST when we report testing. So most of the part of the impact of GST in terms of renewal commission commission new business and expansion in credit only the left in the first half [indiscernible] commission for the business retail until 2 seconds. So it will not be. And if I be correctly, we quantified this number, we're expecting the annual impact, maybe maybe around 1.8, 1.9 kind of things. If yes, it would have been implemented from the beginning.

And second, sir, as we move towards nonbanca channels over the next 2 to 3 years, or the share of nonbank channel increases in our overall mix on a caretakers basis, will that have a negative impact on margins because we believe that banca would be a slightly higher margin with channels versus nonbanker. So will that will -- if we don't do anything on the product mix side, will that have a negative impact on our overall margins?

No, no. I don't think -- and we don't think there will be any negative impact in. In fact, any channel addition will bring value to the table and why we have the fish expenses get amortized and quality happen. I think that we [indiscernible] would not be any negative impact on the margin.

Next question is from the line of Harshal Mehta from Asian Market Securities.

Two quick questions from me. So firstly, as you know, we are in the earlier days [indiscernible] So my first question was that we know that we are in the initial -- but if you can give some initial thoughts on how the KPIs will be for SLF under the IFRS. That was one. And secondly, like our strategy has been to focus on additional products and within that we have seen far growing significantly higher than non-par, but given the backdrop that we have recently launched an one-product in Jan, how do you expect non-part category to move from here on?

See, as far as the IFRS is concerned, we are prepared. And as you know, we have submitted the pro forma to the regulator from the last 2 financial years. And as already mentioned in the result remarks, we are going to have a forbearance for this fiscal. And next year onwards, we will be prepared to launch into the IFRS regime. And we don't see anything as of now to bring in on a KPI into the company's performance. or to disclose at any point of time during this financial year. So we will see first how it will evolve over the next 2 to 3 years' time and then to bring in because it has got implications into the business. because we cannot just bring the KPIs to the business, which will be definitely look into different aspects as far as IFRS instruction.

Second part, you asked about product I think How we're going to see parts still the contribution is around 7% almost and the perspective on par we have launched. We do believe that the new launch in non-par we see a lot of attraction on that, that will also bring the movement in the non-par. And again, if interest rate is going to be established the current day, we will reprice and we better return. So that also helped us to improve the growth of the non-par business assets.

Our next question is from the line of [indiscernible] from Phillip Capital.

So just at the 2 data keeping questions. One was on online channel growth that was very strong until 9 months. So like 45% Y-o-Y basis. So anything on the discrete Q4 number or the full year number, that will be helpful. And the second is on attachment rate on the credit life portion. So what is the [indiscernible] rate on home loans. So if you can just with 2 data points.

So as far as our online business, which is purely on our own website, it is almost in a similar range of 48% to 50% growth, which we have done for the full financial year. and that we will continue to focus more on this channel on our road. And as far as the attachment ratio of credit life, I think it is going in the similar what we have been doing it for the previous year around 50% of [indiscernible]

The next question is from the line of [indiscernible] from MLP.

Sir, the question was with regards to the cost ratio. So if I look at the operating expense ratio has moved up from 5.3% to 6.1% in FY '26 versus last year. And you explained that this is due to GST, the impact of GST invested in the cost now. So is it only from September to March the cost impact that we are looking at here. So let's say, for FY '27, given that the entire year will have GST impact. So hypothetically, I mean, is this 6.1 million only reflective of 6 months of GST? Or this includes the full year impact of GST.

The other one-off item, I think was heard in the last all that which is the -- has also the sales impacting this increase in the operating expenses. But we are confident that it will not go under our rate rather than the way we are managing the expenses of the company will continue to be in that range.

Sure. So sir, if you can just quantify the deviation from 5.3% to 6.1% that we see, how much of that is attributable to GST? And how much of that is attributable to new labor code if you can just quantify.

Yes, I can just tell you that if the labor code or the GST not been there, then the OpEx ratio would have been around 5.5 against 5.4.

Okay. Understood, sir. Got it. So safe to say that next year, it may go up slightly given that this only has 6 months of DST, but it won't go materially up from here. Is that the right thing to read it?

It's not necessarily because the OpEx is not only a one-off item of the DST, which will impact. There are other measures which we take. So that will also help to rationalize the cost. And then we also look into the economics of the expenses where we want to do whether we want to do or not. But yes, as far as the growth is concerned, we are very focused that we will spend our money on the investments, particularly on the branches, IT infrastructure that will continue. But it will not have much impact as far as the OpEx is concerned for the company.

Understood. And sir, the next question is on the channel mix. While this year, we saw other channels contributions are improving. For next year also, do you expect the other channel contribution shares to improve. And let's say, from a 2- to 3-year perspective, what would be the, let's say, SBI contribution or any targets sort of you're maintaining to reduce the contribution from SBI going forward?

So we are not targeting any reduction from SBI. What we are targeting is tapping additional opportunity on the agency and emerging business channel. And in line with that, the higher growth coming from these to segment will improve their contribution in the overall distribution mix. We are not targeting any reduction from SBI.

Understood. Understood. So with the effect of diversification, where would you see the overall mix, let's say, ex banca and within banca maybe SBI? What would be, let's say, target share of these other segments that we want to keep.

So in last 2 years, we have seen approximately 3% to 4% shift from banca to agency and agency and emerging businesses and all. And we expect the similar trend in coming years.

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

Thank you, everyone, for your time and queries. You may get in touch with our Investor Relations team in case you have any follow-up questions, and we will be happy to respond to that. Thanks, again, God bless everyone.

On behalf of SBI Life Insurance Company Limited, that concludes this conference. Thank you all for joining us. You may now disconnect your lines.