Medanta operator Global Health rises 2% on robust Q1 show, growth plans

Medanta plans to add around 800-1,300 beds over the next two-three years.

The shares of Medanta hospital chain operator Global Health rose over 2 percent in early trade on August 11 as investors cheered the company's stellar show in the April-June quarter.

The hospital chain on August 10 reported a 73.75 percent on year rise in consolidated net profit for the June quarter at Rs 102.01 crore. Revenue also showed strong growth, jumping 25.28 percent year-on year to Rs 773 crore.

Revenue share for developing hospitals (Medanta Lucknow and Patna) also rose to 28.9 percent against 23.4 percent in the year-ago period. Revenue from international patients jumped 45 percent to Rs 47.7 crore, driven by increased volume and realisation.

The Average Revenue Per Occupied Bed (ARPOB), a key growth metric, grew 7.1 percent on year to Rs 63,148.

At 9.19 am, Global Health was trading at Rs 701.05 on the National Stock Exchange, 1.6 percent higher from the previous close.

Follow our live blog for all the market action

The company's operational performance also improved, as the EBITDA margin expanded to 25.1 percent from 22.6 percent in the year-ago quarter.

The hospital chain added 28 new beds at its Patna facility, taking the group’s bed capacity to 2,725 in Q1 from 2,697 in the previous quarter.

Ties up with DLF for Delhi hospital

The company also announced plans to develop a 400-bed super-specialty hospital in Delhi in partnership with DLF to further strengthen presence in the National Capital Region, taking its bed count to around 2,400 in the region.

Global Health and DLF will form a new company, with both contributing an equal 50-50 percent to the new venture. Medanta will run the hospital and have operational control, while DLF will be a strategic investor.

The hospital will provide cutting-edge medical and surgical interventions in over 20 specialties and also have a comprehensive cancer care unit.

"This hospital will allow us to serve patients across the entire NCR belt by seamlessly linking our facilities in Gurgaon, Delhi and Noida," Pankaj Sahni, Group CEO and Director of Global Health, said in a press release.

The company also plans to add around 800-1,300 beds over the next two-three years. Out of the total, 770 beds, or 60 percent of the new capacity, will be added at existing hospitals, leading to lower capital expenditure per bed.

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.