U.S. Markets closed

Will ICICI Prudential Life Insurance Company Limited's (NSE:ICICIPRULI) Earnings Grow In The Next 12 Months?

Simply Wall St

Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!

On 31 March 2019, ICICI Prudential Life Insurance Company Limited (NSE:ICICIPRULI) released its earnings update. Generally, analysts seem fairly confident, as a 6.7% increase in profits is expected in the upcoming year, compared with the past 5-year average growth rate of -0.4%. Currently with trailing-twelve-month earnings of ₹13b, we can expect this to reach ₹14b by 2020. In this article, I've outline a few earnings growth rates to give you a sense of the market sentiment for ICICI Prudential Life Insurance in the longer term. Readers that are interested in understanding the company beyond these figures should research its fundamentals here.

See our latest analysis for ICICI Prudential Life Insurance

What can we expect from ICICI Prudential Life Insurance in the longer term?

The longer term expectations from the 21 analysts of ICICIPRULI is tilted towards the positive sentiment. Since forecasting becomes more difficult further into the future, broker analysts generally project out to around three years. To reduce the year-on-year volatility of analyst earnings forecast, I've inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line.

NSEI:ICICIPRULI Past and Future Earnings, July 16th 2019

This results in an annual growth rate of 12% based on the most recent earnings level of ₹13b to the final forecast of ₹18b by 2022. EPS reaches ₹12.36 in the final year of forecast compared to the current ₹9.02 EPS today. In 2022, ICICIPRULI's profit margin will have expanded from 3.1% to 3.8%.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For ICICI Prudential Life Insurance, I've put together three relevant aspects you should look at:

  1. Financial Health: Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
  2. Valuation: What is ICICI Prudential Life Insurance worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether ICICI Prudential Life Insurance is currently mispriced by the market.
  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of ICICI Prudential Life Insurance? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.