Hold Krishna Institute of Medical Sciences: target of Rs 630: ICICI Securities

ICICI Securities recommended hold rating on Krishna Institute of Medical Sciences with a target price of Rs 630 in its research report dated May 14, 2025.

Broker Research

May 23, 2025 / 12:05 IST

hold

26 Aug, 2025 12:21

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ICICI Securities research report on Krishna Institute of Medical Sciences

Krishna Institute of Medical Sciences’ (KIMS) delivered robust performance in Q4FY25 with revenue/EBITDA/PAT surging 26%/29%/49%, respectively. Existing clusters of AP/ Telangana grew 19%/23% while EBITDA growth was much faster at 37%/34% YoY, respectively. However, new hospitals in Nashik and Kollam dragged EBITDA by INR 180mn. KIMS added 2 new hospitals in Guntur (200 beds) and Sangli (350 beds on O&M basis) in Q4. Thane and 2 Bangalore hospitals could commence operations in H1FY26 (as per schedule). KIMS may increase bed capacity by 45% to 7,500 beds by FY27.

Outlook

We increase our EBITDA by 1-3% for FY26/27E factoring in faster breakeven. We factor in an EBITDA CAGR of 24.5% over FY25-27E driven by revenue CAGR of 24.4%. We like the company for its dominant position in Telangana and Andhra Pradesh, geographical expansion, strong margin profile and prudent capital allocation by the management. The stock currently trades at a pricey valuation of 28.2x FY26E and 22.6x FY27E adjusted (ex-minority) EV/EBITDA. We maintain HOLD with an unchanged target price of INR 630 based on 26x FY27E adj. EV/EBITDA (earlier: 29x FY26E adj. EV/EBITDA).

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