Feb 14, 2017 01:55 PM IST | Source:

Hold Narayana Hrudayalaya; target of Rs 341: Axis Direct

Axis Direct recommended hold rating on Narayana Hrudayalaya with a target price of Rs 341 in its research report dated February 08, 2017.

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Todays L/H

Axis Direct's research report on Narayana Hrudayalaya

We believe NH is entering a strong growth phase, as capacity utilization ramps up and new beds get added. We expect occupancy to improve further over the next 3 years. As bulk of the capex is over, we expect 20% revenue CAGR coupled with 450 bps improvement in EBITDA margin to 16% (as utilization improves) over FY16-20.


While immediate upside is capped, we believe, the stock can compound at 15% given earnings are back-ended and 3x increase in EBITDA to Rs 5 bn expected by FY20. Maintain HOLD with DCF based TP of Rs 341(implies 24x FY18E EV/EBITDA).

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