HDFC Life insurance Company fair value — is it overvalued?
The fair value of HDFC Life insurance Company (HDFCLIFE), built from its filed accounts — ten years of results, the method that fits this business, and what today's price already assumes.
The market expects much less from HDFC Life insurance Company than it has delivered before.
At today’s share price, buyers are paying about 12.5× the embedded value of the new business HDFC Life insurance Company writes. The model values the new policies HDFC Life insurance Company is writing at about 25× their embedded value. That is a big step down from its own record. Either the market can see a problem that the published accounts do not show yet, or it is expecting a slowdown that has not happened.
What the market is assuming
Worked backwards from today's share price: the new-business multiple today’s price implies for HDFC Life insurance Company, against what the model assumes.
How to read this. The number on the left is the new-business multiple today’s share price quietly takes for granted. The number on the right is what the model actually assumes. When the two are far apart, that gap is the bet you would be taking.
The numbers behind them
Revenue and net profit as filed, in ₹ crore.
| Year | Revenue | Net profit | Margin |
|---|---|---|---|
| FY2025 | 96,184 | 1,811 | 1.9% |
| FY2026 | 98,770 | 1,912 | 1.9% |
How this company gets valued — and why
A life insurer is not valued on its reported profit. Most of its worth sits in policies already sold, which will pay out over decades — and writing new business actually reduces this year's reported profit while creating value that lasts. It is valued on embedded value plus the value of new business instead, which is the measure the industry itself uses.
Embedded value — the correct lens for a life insurerUnderstand this method
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The complete valuation
Unlock the complete valuation report
- ✓Fair value per share — with the full working behind it
- ✓Bull, base and bear cases — and what moves between them
- ✓Every assumption — growth, margins, cost of capital, with sources
- ✓Peer comparison — how rivals are priced on the same measures
- ✓Downloadable PDF report — the full write-up, yours to keep
Compare with peers
The same valuation, run side by side.
HDFC Life insurance Company vs SBI LifeThe two largest private life insurers, on embedded value.→HDFC Life insurance Company vs LICPrivate against the state-owned incumbent, same measures.→HDFC Life insurance Company vs HDFC BankA life insurer on embedded value against a bank on excess return.→Frequently asked
Is HDFC Life insurance Company overvalued?
At ₹516 the market is pricing in roughly 12.5% sustained VNB, against the ~25.0% its own record supports. That is less than it has delivered — on these numbers the market is asking the business for less than its own record, which usually means it doubts the record repeats.
What is the intrinsic value of HDFC Life insurance Company?
It is computed from the filed financial statements using the method that fits this business (embedded value), with every assumption shown alongside the result. The per-share figure and the full working are in the report.
How does FairStocks calculate fair value?
From published financial statements. The method is chosen to fit the business — a bank on excess return, a regulated utility on its rate base, a conglomerate by its parts — and every assumption is shown with its source. When the numbers do not support an estimate, no estimate is published. This is an educational research tool: it reports what the model computed and does not recommend buying or selling anything.
What assumptions are used to value HDFC Life insurance Company?
A cost of capital of 10.94%, growth drawn from the company's own record rather than from guidance, and the valuation method that fits the business. All of them are listed in the report, with how much each one moves the answer.