National Life Insurance Q4 Results: Revenue Growth Steady, Profit Margins Under Pressure

National Life Insurance Company Limited (NLICL), one of Nepal’s largest life insurers, has published its audited Q4 results for FY 2024/25, showing consistent revenue growth supported by higher premiums, though profitability margins remained under pressure due to rising claims.

The company reported a total revenue of Rs. 28.60 billion in Q4, a 13.60% year-on-year increase compared to Rs. 25.62 billion in Q4 FY 2023/24. Revenue also expanded from Rs. 19.37 billion in Q3 and Rs. 13.09 billion in Q2, showing healthy growth across the fiscal year.

The gross profit stood at Rs. 2.87 billion, reflecting a gross margin of 10.04%, slightly lower than last year’s 10.37% and weaker than earlier quarters. Despite higher revenues, margins remain compressed due to increased operating costs and claim obligations.

Net income came in at Rs. 412.84 million, nearly flat compared to Rs. 406.36 million in Q4 last year. The net margin stood at just 1.44%, down from 1.59% a year ago, underscoring challenges in profitability.

Return indicators remained modest. Return on Assets (ROA) stood at 0.43%, and Return on Equity (ROE) was 5.84%, both slightly lower than last year. On a per-share basis, EPS (annualized) came in at Rs. 7.54, compared to Rs. 8.11 in Q4 FY 2023/24. The reported PE ratio stood at 82.66, suggesting the stock remains highly valued despite modest earnings.

The book value per share declined to Rs. 129.72, from Rs. 144.28 last year, while the market value per share rose to Rs. 623.58, showing strong investor confidence in long-term stability. Dividend for FY 2024/25 has not been announced; last year, the company distributed Rs. 15 per share.

Insurance Business Indicators

• Total enforced policies fell to 1,519,745 (-4.91% YoY), continuing a downward trend.

• First-year premium collections rose to Rs. 6.08 billion (+20.34% YoY), indicating strong new business inflows.

• Single premium rose to Rs. 2.39 billion (+26.31% YoY).

• Renewal premiums increased to Rs. 15.74 billion (+11.11% YoY), maintaining steady retention.

• Claims paid reached 67,480 (+16.17% YoY), reflecting higher benefit payouts.

• Outstanding claims climbed to 19,123 (+19.21% YoY), highlighting growing obligations.

• Long-term investments rose sharply to Rs. 68.89 billion from Rs. 57.57 billion last year, strengthening the asset base.

• Short-term investments stood at Rs. 7.19 billion, lower than Rs. 11.45 billion in Q4 last year.