Fact based stock research
HDFC Life Insurance (BSE:540777)

INE795G01014

How to read the ranks

For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

HDFC Life Insurance stock research in summary

hdfclife.com

ANALYSIS: With an Obermatt Combined Rank of 96 (better than 96% compared with investment alternatives), HDFC Life Insurance (Life & Health Insurance, India) shares have much better financial characteristics than comparable stocks. Shares of HDFC Life Insurance are low in value (priced high) with a consolidated Value Rank of 22 (worse than 78% of alternatives) and show below-average growth (Growth Rank of 43) but are safely financed (Safety Rank of 100), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 96, is a strong buy recommendation based on HDFC Life Insurance's financial characteristics. As the company HDFC Life Insurance's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 22) and low growth (Obermatt Growth Rank of 43), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 100) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	22
Growth Rank	43
Safety Rank	100
Combined Rank	96

Country	India
Industry	Life & Health Insurance
Index	Good Governace Growth Markets, CNX Nifty 50
Size class	X-Large

This stock has achievements: Top 10 Stock.

18-Apr-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

Why popular stocks have low ratings

It’s easier said than done. When your stock drops, it’s easy to want to sell it and find a better performer. Think twice, or even three times, before trading. Those fees (especially the hidden ones) can eat up your gains.

Review the performance ranks of the individual metrics that form each investment strategy.

Research History: HDFC Life Insurance

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	9	17	16	22
GROWTH
GROWTH	73	53	45	43
SAFETY
SAFETY	75	100	100	100
SENTIMENT
SENTIMENT	n/a	69	69	^new
360° VIEW
360° VIEW	n/a	47	16	^new

Most recent update of the stock research: 18-Apr-2024. Financial reporting date used for calculating ranks: 31-Dec-2023. Stock research history is based on the Obermatt Method. The higher the rank, the better HDFC Life Insurance is in the corresponding investment strategy.
Upgrade to a Premium Account to access the latest ranks.

Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	9	17	16	22
GROWTH
GROWTH	73	53	45	43
SAFETY
SAFETY	75	100	100	100
COMBINED
COMBINED	47	96	96	96

Last update of combined financial performance: 6-Oct-2022. Stock analysis on combined financial performance: The higher the rank of HDFC Life Insurance the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 22 (worse than 78% compared with alternatives), HDFC Life Insurance shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, where the majority of metrics are below, and only one is above average for HDFC Life Insurance. Price-to-Sales (P/S) is 72, which means that the stock price compared with what market professionals expect for future sales is lower than 72% of comparable companies, indicating a good value concerning to HDFC Life Insurance's revenue size. But all other performance indicators point in a different direction. Dividend yields have a Dividend Yield rank of 24, meaning that dividends are expected to be lower than for 76% of comparable investments. Furthermore, Price-to-Book Capital (also referred to as market-to-book ratio) is less favorable than 97% of alternatives (only 3% of peers have an even higher ratio). The same is valid for Price-to-Profit (or Price / Earnings, P/E), which is higher than for 95% of comparable companies, making the stock more expensive compared with the company's expected profit levels. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 22, is a sell recommendation based on HDFC Life Insurance's stock price compared with the company's operational size and dividend yields. Since Price-to-Sales is a stable value indicator even in challenging times, investing in HDFC Life Insurance could be seen as a value investment. However, there must be a good reason for the low market-to-book rank. If the company has a typical capital investment practice, the stock may be overvalued because the profit and dividend-related performance indicators are also low. The stock is only good value if investors can expect profits and dividends to pick up in the future. Else, HDFC Life Insurance looks like an expensive investment today. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	31	53	68	72
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	14	3	3	5
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	1	3	1	3
DIVIDEND YIELD
DIVIDEND YIELD	34	22	22	24
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	9	17	16	22

Last update of Value Rank: 18-Apr-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of HDFC Life Insurance; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 43 (better than 43% compared with alternatives), HDFC Life Insurance shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for HDFC Life Insurance. Sales Growth has a rank of 58, which means that, currently, professionals expect the company to grow more than 58% of its competitors. Profit Growth with a rank of 67 is also above average. But Capital Growth has only a rank of 3, and Stock Returns with 43 are also below-average. Stock returns for HDFC Life Insurance have recently been below 57% of alternative investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 43, is a hold recommendation for growth and momentum investors. Are investors forecasting troubles based on the lack of operating investment activity at the company? This could be one explanation as to why stock returns are low. But stock returns can also be the result of correcting an error in the past, in this case, an overly optimistic outlook on the future, which is now more realistic. The Value Ranks may confirm such a picture. The more important growth indicators are revenues and profits, which are both above average for HDFC Life Insurance. This is a positive sign from the company's operational side and may give investors courage, despite the poor recent stock price performance. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with the Obermatt Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	94	82	68	58
PROFIT GROWTH
PROFIT GROWTH	n/a	25	63	67
CAPITAL GROWTH
CAPITAL GROWTH	n/a	83	5	3
STOCK RETURNS
STOCK RETURNS	57	29	53	43
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	73	53	45	43

Last update of Growth Rank: 18-Apr-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of HDFC Life Insurance.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 100 (better than 100% compared with alternatives) for 2022, the company HDFC Life Insurance has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of HDFC Life Insurance is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, where all three are above average for HDFC Life Insurance. Leverage is at 82, meaning the company has a below-average debt-to-equity ratio. It has less debt than 82% of its competitors. Refinancing is at a rank of 95, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 95% of its competitors. Finally, Liquidity is also good at a rank of 82, which means that the company generates more profit to service its debt than 82% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 100 (better than 100% compared with alternatives), HDFC Life Insurance has a financing structure that is significantly safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. Investors may not have a debt issue with HDFC Life Insurance but they should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	75	82	79	82
REFINANCING
REFINANCING	34	95	95	95
LIQUIDITY
LIQUIDITY	82	87	79	82
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	75	100	100	100

Last update of Safety Rank: 6-Oct-2022. Stock analysis on safety metrics: The higher the rank, the lower the leverage of HDFC Life Insurance and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	70	71	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	25	67	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	68	12	^new
MARKET PULSE
MARKET PULSE	n/a	64	82	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	69	69	^new

Last update of Sentiment Rank: 18-Apr-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for HDFC Life Insurance.
Upgrade to a Premium Account to access the latest ranks.