BENGALURU (Reuters) - India's HDFC Life Insurance posted a 15% rise in first-quarter profit on healthy premium growth on Monday, helped by strong demand for its market-linked products in a booming stock market.

HDFC Life, the first Indian life insurer to report June-quarter results, said profit rose 15% to 4.78 billion rupees, while net premium income grew nearly 9%.

India's equity market has hit multiple record highs in recent months on strong economic growth outlook and foreign fund inflows, and analysts say market-linked insurance plans (ULIPs) will drive premium growth in a largely under-penetrated market.

HDFC Life's value of new business (VNB), or expected profit from new policies, rose 18% year-on-year to 7.18 billion rupees ($86 million) for the April-June period.

The company's annualised premium equivalent (APE) sales, a key metric that gives annualised total value of all single premium and recurring premium policies, grew 23% to 28.66 billion rupees for the quarter.

However, the rise in sales of ULIPs, which have a lower profit margin, has resulted in the contraction of the value of new business margins for insurers in the recent quarters.

ULIPs made up 38% of its overall product mix by individual APE for the quarter, up from 25% a year earlier.

HDFC Life's VNB margin declined to 25% for the April-June quarter from 26.2% a year earlier.

Shares of the company settled 0.4% up after the results.

($1 = 83.5450 Indian rupees)

(Reporting by Nishit Navin in Bengluru; Editing by Sohini Goswami)