HDFC life insurance yearly revenue seems to have peaked in 2021. It’s yet to cross that number even after a couple of years. Even if it happens in Fy23 then the YoY growth will only be ~5%. It’s another debate if revenue growth will peak in the coming year. Additionally it also has an overhang of merger of HDFC groups. This shows why the market is not giving much respect to this exceptional franchise for the time being. But in the long run it may turn out to be a great compounder as it has all the hallmarks to become so.
So the game plan should be simple to follow. If someone is convinced/confident on its future growth potential then it’s a great time to average with specific position size in mind. Otherwise it’s better to move on and find other bargains from the market. Personally speaking I don’t have a good track record of making money from insurance companies (except Kinsale Capital in the US market), hence I preferred to bail out.
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