Narayana Hrudayalaya: Quarterly Result update
13-08-2022

Narayana Hrudayalaya Ltd | Market Cap: Rs. 13,936 Cr

CMP 682 | P/E 36x FY23

Results

(INR Cr)

Y-o-Y Growth

Comments

Revenue

1033

20%

Driven by 56% growth in Bangalore cluster

EBITDA

200

43%

Improved Occupancies in Indian hospitals

Click here for 10 year X-ray

Key highlights:

  • Occupancies in India improved to 48.1% in 1QFY23 (vs 42.1% in 4QFY22)
  • Continues to benefit from a higher mature hospital mix (beds <5 years old were 12% in 1QFY23 vs 45% in FY2017)
  • Strong performance of flagship hospitals in India as well as steady growth in Cayman. However, Cayman operations in were impacted due to Covid restrictions.
  • ARPOBs were driven by mix improvement & volume growth.
  • Despite occupancy being at 67%, the Mumbai hospital is operating at EBITDA breakeven. New Hospitals reported the EBITDA margin of 6.5%.

Management Outlook

  • The key driver for ARPOBs will be mix improvement, volume growth, and throughput. Will take a low single digit price hike in Jan’23.
  • Focusing on high-risk pregnancies in addition to high-end NICU, cardiac sciences and transplant programs. The high-end procedures require additional manpower, which is having an impact on margins.
  • Greenfield expansion will be in Kolkata and Bangalore. The company will build specialties and capabilities in different units and will be expanding in the Health City, Bangalore. It will add oncology units in all hospitals, and carry out a brownfield expansion in the Kolkata facility
  • Overall, capex of Rs.110 Cr was incurred in 1QFY23. The company is on track for Rs. 100 Cr+ capex in FY23. This is a mix of greenfield, brownfield and inorganic. The capex incurred in FY23 will be mostly focused on increasing yields per room than just increasing no. of beds.
  • The company aims to reduce ALOS from current levels of 4.6 to 4.2.
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