ICICI Prudential gets GST demand notice worth Rs 429 crore

An Indian provider of life insurance is ICICI Prudential Life Insurance Company Limited. ICICI Prudential Life was founded as a joint venture between Prudential Corporation Holdings Limited and ICICI Bank Limited and operates in the asset management and life insurance sectors.

GST demand of Rs. 429 crore to ICICI Prudential:

On Tuesday, ICICI Prudential Life Insurance announced that it had received a GST demand notice totaling Rs 429 crore, along with interest and penalties. The insurance company declared that, within the allotted time, it would file an appeal of the order with the Commissioner (Appeals). A total of Rs 208.02 crore in GST, Rs 200.2 crore in interest, and Rs 20.8 crore in penalties were demanded.

The Deputy Commissioner of State Tax, Maharashtra, sent out the notice regarding the reversal of the input tax credit, the inconsistency in the ITC/credit note according to GSTR 3B, GSTR 9, and GSTR 2A, and the failure to pay tax on specific outward supplies.

ICICI Prudential Life Insurance Company Ltd. Q1 FY25 Result:

Due to an increase in expenses, ICICI Prudential Life reported an 8.7% year-over-year increase in net profit to Rs 225.4 crore in the first quarter of FY25. From Rs 149.47 crore in Q1 FY24 to Rs 198.53 crore in the current quarter, the company’s expenses grew by 32.8%. The company stated that the VNB margin, a measure of profitability, dropped from 30% during the same period last year to 24% in Q1 FY25.

In the meantime, compared to the same period last year, the company’s new business premiums increased by 23.5% YoY to Rs 3,769 crore from Rs 3,051 crore. During this time, its annualized premium equivalent (APE) increased by 34.4% year over year to Rs 1,963 crore. APE is the total of 10% weighted single premiums and annualized first-year regular premiums.

ICICI Prudential Life’s solvency ratio was 187.9% in Q1 FY25 compared to 203.4% in the same period last year. The insurer’s persistency ratio held steady, with the 13th month’s ratio standing at 86.4% and the 61st month’s ratio at 67.3% during the reviewed quarter.

The stock price of ICICI Prudential:

Currently, the stock is running at Rs. 741.05 per share, and stock is slightly declining today in the intraday segment, but we can see the recovery in the stock as ICICI Prudential is going to appeal for the GST against them.

Conclusion: ICICI Prudential Life Insurance Company Ltd. is going to appeal against the GST of Rs. 429 crore. Investors and traders are closely monitoring the outcome of the appeal as it will impact their decisions regarding the stock.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.