Buy Aster DM Healthcare; target of Rs 210: ICICI Direct

ICICI Direct's research report on Aster DM Healthcare

Q3 revenues stayed flat QoQ at Rs 2259 crore (still down 2.7% YoY) vs. Rs 2268 crore in the last quarter. India revenues grew 10.8% QoQ (up 6.7% YoY) to Rs 460 crore. However, GCC revenues de-grew 3.4% QoQ (down 4.6% YoY) to Rs 1866 crore. EBITDA margins expanded 257 bps QoQ to 14.5% due to lower other expenditure. Subsequent EBITDA grew 21.0% QoQ to Rs 328 crore. PAT came in at Rs 92 crore, which is ~2.8x of last quarter.

Outlook

We envisage favourable risk-reward matrix and maintain BUY rating with a target price of Rs 210 on SOTP basis (vs. earlier Rs 170).