Max Financial Services Limited — Q3 FY26 earnings call

Call held 12 Feb 2026

Management summary

Max Financial Services Limited reported strong Q3 FY26 results, driven by robust growth in individual adjusted first year premium (20% in 9M FY26) and retail APE (30% in Q3). VNB margins expanded to 23.6% for 9M FY26, with Q3 margins at 24.1%, despite one-time impacts from GST disallowance and labor code changes. The company received in-principle approval for the amalgamation of Axis Max Life and MFSL, with a projected timeline of 12-14 months post-scheme filing. Management expressed confidence in sustaining growth momentum and achieving NBM targets of 24-25% for FY26.

Highlights

  • Individual Adjusted First Year Premium grew by 20% in 9 months FY26, led by 18% growth in the number of policies, translating to a private market share expansion of 53 basis points to 9.8%.

  • Retail APE grew a strong 30% in Q3 FY26, driven by 52% growth in proprietary channels (agency, online, cross-sell) and 13% growth in partnership channels.

  • Retail protection grew by 99% in Q3, with pure protection up 95% and riders over 100%, supported by GST-related tailwinds and targeted execution.

  • Annuity business showed healthy momentum, growing 141% in Q3 FY26 and 107% in 9M FY26, driven by consistent execution and growing customer demand.

  • 13-month persistency stood at 85% in Q3 FY26, and 25-month persistency improved to an all-time high of 76%, reflecting a nearly 420 basis point YoY improvement.

Concerns

  • Consolidated profit after tax at ₹137 crore is lower than last year due to fair value chain impact and GST expense impact at MFSL level.

  • GST disallowance of ₹295 crore and a one-time gratuity provision of ₹60 crore due to labor code changes impacted policyholder opex, which grew 25% (vs. 14% adjusted).

  • 13-month persistency experienced pressure due to certain product categories and surrender regulations, though management is taking actions to mitigate this.

Key financials

3 periods

Headline

  • Revenue (ex-investment income)
    ₹24,625 Cr
    YoY +18%
  • Consolidated PAT
    ₹137 Cr
  • Gross Written Premiums
    ₹25,195 Cr
    YoY +18%
  • Renewal Premium
    ₹15,591 Cr
    YoY +17%
  • Individual New Business Sum Assured
    ₹3.60L Cr
    YoY +41%
  • Embedded Value (EV)
    ₹28,110 Cr
    YoY +16%
  • Annualized Operating RoEV
    16.9%
  • Solvency Position
    201%
  • Assets Under Management (AUM)
    ₹1.93L Cr
    YoY +12%

Q3 FY26

  • VNB Margins
    24.1%

9M FY26

  • Policyholder Opex to GWP Ratio
    15.8%
  • VNB Margins
    23.6%

What they filed

Q1 FY27: revenue up 16.8%, net profit up 37.2% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue13,372 8,923 12,376 12,822 9,792 −27%14,259 +60%10,802 −13%14,970 +17%
EBITDA173 89 20 119 21 −88%78 −12%-6 −130%167 +40%
Net profit139 70 38 86 6 −96%45 −36%-32 −184%118 +37%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Capital allocation

high confidence
  • M&A Axis Max Life and MFSL Merger · Pending regulatory

    To attract additional capital into the sector by increasing the FDI limit from 74% to 100%, enhancing ease of doing business and strengthening policyholder protection, following Insurance Act amendments.

    As part of this reform, Section 35 was amended to permit the merger of an insurer with a non-insurer subject to IRDAI approval. This is a positive development for Axis Max Life. Accordingly, we have received in-principle approval from our Board to initiate the process for the proposed amalgamation of Axis Max Life and MFSL. As we progress on the journey, we will continue to provide regular updates on the progress we are making on this.

Guidance & targets

Profitability

  • NBMs (New Business Margins) Profitability · FY26 · High confidence 24% to 25%
    We continue to reinforce our guidance, which we had set out at the start of the year that -- which is for FY '26, the NBMs will land in the range of 24% to 25%, along with now stronger sales outcome that we are experiencing.

    — Amrit Singh

Market Share Growth

  • Market Share Expansion vs. Industry Market Share Growth · longer horizons · Medium confidence 300 to 500 basis points faster growth than the market
    Over longer horizons, we have always maintained that from a market growth perspective, from the industry's overall growth that happens in experiences, we will always try to aspire for a 300 to 500 basis points faster growth than the market. And that remains that we hold on to.

    — Amrit Singh

What to watch in Q4 FY26

Amalgamation timeline progress

next quarter / 12-14 months from scheme filing
Current In-principle approval received, process initiated
Target Further regulatory guidance and clarity on scheme filing

Why it matters

The amalgamation of Axis Max Life and MFSL is a significant strategic move that will impact the company's structure and future operations.

from the date of filing of the scheme, we do not expect it to be more than 12 to 14 months kind of a time frame.

Risks & concerns

  • GST expense and fair value chain impact on PAT

    medium

    Consolidated PAT is lower than last year due to fair value chain impact and GST expense impact at MFSL level.

    Management acknowledged

  • GST disallowance and one-time gratuity provision

    medium

    GST disallowance of ₹295 crore and a ₹60 crore gratuity provision impacted policyholder opex growth.

    Management acknowledged

  • Persistency pressure due to product categories and surrender regulations

    medium

    13-month persistency experienced pressure from certain product categories and post-surrender revisions, but actions are being taken to improve it.

    Management acknowledged

  • Short-term sales impact from mis-selling curbs

    low

    While curbing mis-sell might appear negative for sales in the short-term, it is positive for the industry in the long run.

    Management downplayed

Q&A highlights

8 direct
VNB margins and impact mitigation Direct
But assuming that, that also stays and GST impact was not there, your observation is right. The margins could have been 200 basis points higher than what we have reported, for sure. And largely, a significant a reasonable portion of this is also coming from the yield curve support that we are experiencing for ourselves.

Analyst questioned the extent of margin mitigation from distributor negotiation vs. cost/product mix, and management clarified the potential margin impact if GST wasn't a factor.

Asked by Shreya Shivani

Regulatory changes and impact on banca channel Direct
I think on the second one, you mentioned about the circular, which came in yesterday also some of the changes that have happened since November 2024. In all our interactions and whatever we have seen so far of the circular, I think these are all steps in the right direction. Eventually, they build more customer confidence.

Analyst inquired about the impact of recent RBI regulations on the banca channel, and management viewed them positively for customer confidence and penetration.

Asked by Shreya Shivani

Sustainability of growth momentum and non-par sales Direct
Very frankly setting in 9 months right now, we are very confident. I think we will be able to continue through this momentum, which may be an upward revision to certain guidances that we provided at the start of the year. So at least on sales, the teams are quite confident with the momentum that we are experiencing.

Analyst questioned if the strong growth was sustainable, and management expressed high confidence in continuing the momentum, potentially leading to upward revision of guidance.

Asked by Avinash Singh

VNB margin walk, labor law impact, and persistency Direct
On labour law impact on the P&L, the impact is around on the gratuity provisions, an impact of around INR 60 crore that we had to take. This is a onetime hit which we had to provide for. This is actually routed not through the margins, but through the EV because it is a onetime and a one-off margins anyways will over time horizons kind of bake in, let us say, this increase outflows, but obviously, certain actions at our end will also happen in restructuring overall compensation philosophy, so that some mitigation is also provided to these.

Analyst sought granular detail on the one-time impacts on margins and EV, and management clarified the nature and mitigation strategies.

Asked by Swarnabh Mukherjee

Key priorities for profitability and growth balance Direct
Firstly, I think being financially disciplined is one of the key priorities internally that we drive as well, and we have always committed that we are anchored to maintaining the margin profile in the range of 25% plus/minus. With the bias towards distribution expansion, given the severe underpenetration, the country has and the opportunity that lies in front of us. So we will keep the growth momentum going, but always ensuring that the margin is also maintained in a steady position.

Analyst asked about the company's strategy to balance growth, innovation, and margin protection, and management reiterated commitment to financial discipline and margin targets.

Asked by Sucrit Patil

Axis channel mix sustainability and group credit life growth Direct
You would recall, at the start of the last year in January of last year itself, we had started indicating that along with bank we are working towards navigating the product mix in a more balanced nature rather than overdependence on a single product form. And we are very happy to see that actually, that navigation, we have been able to execute that did mean for the first 9 months, the numbers to be steady.

Analyst questioned the sustainability of the improved product mix in the Axis channel, and management confirmed it was a result of deliberate strategy and execution.

Asked by Vinod Rajamani

Organic individual business growth in Axis Bank and merger process Direct
So Madhukar, I think it is a little premature for me to comment on the exact and the specific structure. But needless to say, our, collapse of the structure is a very fairly simplistic thing, we have MFSL where large portions of their asset is nothing but the equity that they own in the underlying entity. And at MFSL level on the balance sheet, both on the asset and liability aspects, there isn't anything which is which is very significant or material. So, it will be a fairly simplistic collapse, but please allow us time for the specifics and associated details to come.

Analyst inquired about the seemingly sluggish organic growth in Axis Bank and the specifics of the merger process, with management providing context on both.

Asked by Madhukar Ladha

Scope for new large partnerships and product mix across channels Direct
As far as new partnerships are concerned, I have to say, there is a lot of opportunity as far as the market is concerned. We are in advanced discussions, as far as some of those businesses are also concerned with the various banks across. It would be a little premature to mention, but the opportunity exists across many of the PSU, private banks. So very optimistic in the further growth coming in.

Analyst asked about future growth drivers from new partnerships, and management expressed optimism about opportunities with PSU and private banks.

Asked by Dipanjan Ghosh

3 min read 6 chapters

Detailed narrative

Q3 FY26 Financial Performance Overview

Max Financial Services Limited reported a revenue (excluding investment income) of ₹24,625 crores for the nine months ended December 31, 2025, marking an 18% growth. Consolidated profit after tax stood at ₹137 crore, impacted by fair value chain and GST expenses. Gross written premiums grew 18% to ₹25,195 crores, with renewal premiums up 17% to ₹15,591 crores. The company's Embedded Value (EV) reached ₹28,110 crores, a 16% year-on-year increase, and Assets Under Management (AUM) grew 12% to ₹1.93 lakh crore. VNB margins expanded from 21.9% last year to 23.6% in 9M FY26, with Q3 FY26 margins at 24.1%.

Strategic Focus: Sustainable & Predictable Growth

The company's strategy focuses on consistent and broad-based outcomes, with individual adjusted first year premium growing 20% in 9M FY26, driven by an 18% increase in policies. This growth is double the overall industry growth of 10%, leading to a 53 basis point expansion in private market share to 9.8%. Retail APE grew 30% in Q3 FY26, with proprietary channels (agency, online, cross-sell) growing 52% and partnership channels growing 13%. The NRI segment contributed approximately 12% of individual adjusted first year premium, and the company received regulatory approvals to establish an office in GIFT City to strengthen its presence.

Product Innovation & Margin Enhancement

Product innovation remains a key lever, with a focus on a well-balanced portfolio aligned with long-term protection, retirement, and savings needs. Retail protection grew 99% in Q3, with pure protection up 95% and riders over 100%, benefiting from GST-related tailwinds. Group credit protection business scaled steadily with 45% growth in Q3. The annuity business demonstrated strong momentum, growing 141% in Q3 and 107% in 9M FY26. The Q3 APE product mix was balanced with ULIP at 38%, non-par savings at 18%, protection at 15%, annuity at 10%, and participating products at 20%.

Customer-Centric Approach & Persistency

Axis Max Life maintains a customer-centric approach, reflected in its industry-leading persistency. As per Q2 FY26 rankings, the company was top-ranked in 13-month persistency by number of policies and second in 25-month and 37-month persistency. In Q3 FY26, 13-month persistency stood at 85%, and 25-month persistency improved to an all-time high of 76%, a 420 basis point YoY improvement. Net Promoter Score (NPS) increased to 58 (from 52 at FY25 exit), with touchpoint NPS improving to 16 (from 55) and relationship NPS to 55 (from 50), indicating strong customer confidence.

Digitization for Operational Efficiency

The company is heavily investing in digitization, AI, and data engineering to enhance customer experience, underwriting, persistency, and operational efficiency. GenAI-powered e-mail bots doubled 1-day ticket closures from 20% to 40%. The customer app has 6 lakh downloads and 3 lakh monthly active users, with cumulative transactions exceeding ₹50 crore. Website digital NPS reached a record 74, up 9 points. Voice AI-led transcription analytics enabled 100% automated audits for renewal collection, and straight-through processing (STP) for non-early claims reached 36%, surpassing industry benchmarks for claims up to ₹7.5 lakhs.

Amalgamation of Axis Max Life and MFSL

Following the approval of Insurance Act amendments (Sabka Bima Sabka Raksha Act 2025), which allow for increased FDI limits and insurer mergers with non-insurers, Max Financial Services Limited received in-principle board approval to initiate the amalgamation process for Axis Max Life and MFSL. Management anticipates the process, from the date of scheme filing, to take approximately 12 to 14 months. They noted that the structure is relatively simplistic due to MFSL's equity ownership in the underlying entity and minimal material balance sheet complexities.

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