Apollo Hospitals' healthy Q4 earnings, brokerages cheer upbeat management guidance

Apollo Hospitals' Q4 net profit jumped 77% on year to Rs 258 crore and met market expectations.

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26 Aug, 2025 12:21

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Apollo Hospitals' healthy Q4 earnings combined with the management's upbeat guidance for growth in the ongoing fiscal has ushered optimism among brokerages across the board. After reporting a slight beat on both net profit and revenue for the March quarter, Apollo's management also guided for a mid-teen growth in its core hospital business for FY25.

In addition, the firm also guided for an EBITDA margin of 25 percent by FY25-end for its hospital business, along with plans to take occupancy levels close to 70 percent.

The management also stated that it plans on achieving its occupancy target by increasing its focus on increasing volumes, insurance tie-ups and international patients which should reflect in higher occupancy.

Buoyed by the company's positive earnings performance and strong growth guidance, brokerage firm CLSA upgraded the stock to a 'buy', with a price target of Rs 7,150. The brokerage also feels that the recent decline in Apollo's stock price was unwarranted.

Apollo shares fell around 5 percent in the past three months amid concerns over the government capping rates for hospitals, which CLSA believes will be difficult to implement.

Morgan Stanley also shared a similar bullishness over Apollo Hospitals as it maintained its 'overweight' call on the stock owing to its steady growth and improving return on capital employed (RoCE). The brokerage, which has a price target of Rs 7,181 for the stock, remains confident of the company achieving mid teens growth in FY25.

Adding to the list of bullish calls is Nuvama Institutional Equities, which likes the multiple growth levers present to improve Apollo's earnings growth. While Nuvama feels the company's efforts in hiring clinical talent,

marketing, insurance tie-ups shall improve its hospital occupancy to around 69 percent in FY25, it is its plans to add 2,300 beds that will offer long-term visibility.

In addition, the brokerage also finds Apollo's growth guidance of 20 percent for FY25 and its target to achieve breakeven for its 24/7 business in the next six-to-eight quarters as promising. Nuvama also has a 'buy' call on Apollo with a price target of Rs 7,065.

Meanwhile, Prabhudas Lilladher feels the recent stake sale in Apollo's HealthCo arm to Advent and its merger with pharmaceutical distributor, Keimed are a positive steps and will lead to an integrated pharmacy distribution business complemented by the fast-growing omni-channel digital health business.

"Further, the management guidance of Rs 17,500-20,000 crore EBITDA of the merged entity by FY27, provides comfort," Prabhudas Lilladher stated. The brokerage also has a 'buy' call on Apollo Hospitals with a price target of Rs 7,050.

At 10.29 am, shares of Apollo Hospitals were trading around 1 percent higher at Rs 5,866 on the NSE.