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Investor Presentaiton

Indian Embedded value: Methodology and Approach (1/2) Overview Indian Embedded Value (IEV) consists of: ☐ ☐ Adjusted Net Worth (ANW), consisting of: - - Free surplus (FS); - Required capital (RC); and Value of in-force covered business (VIF): Present value of the shareholders' interest in the earnings distributable from assets allocated to the covered business, after making sufficient allowance for the aggregate risks in the covered business. Components of Adjusted Net Worth (ANW) ☐ Free surplus (FS): FS is the Market value of any assets allocated to, but not required to support, the in-force covered business as at the valuation date. The FS has been determined as the adjusted net worth of the Company (being the net shareholders' funds adjusted to revalue assets to Market value), less the RC as defined below. Required capital (RC): RC is the amount of assets attributed to the covered business over and above that required to back liabilities for the covered business. The distribution of this to shareholders is restricted. RC is set equal to the internal target level of capital equal to 170% of the factor-based regulatory solvency requirements, less the funds for future appropriations ("FFA") in the participating funds. 63 HDFC Life
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