Buy Krishna Institute of Medical Sciences; target of Rs 810: Prabhudas Lilladher

Buy

Prabhudas Lilladher's research report on Krishna Institute of Medical Sciences

Krishna Institute of Medical Sciences (KIMS) reported EBITDA growth of 6% YoY, led by reducing losses from new greenfield units and improved operating leverage at mature clusters. The turnaround time for greenfield units in new clusters has been impressive and thereby demonstrates strong execution. New leadership team hiring across Karnataka and Kerala provides comfort for faster ramp-up in these clusters. Given its lean cost structure and partnership with local doctors/ leadership outside Andhra Pradesh (AP) and Telangana, we remain confident of achieving faster breakeven and +25% OPM across Maharashtra, Karnataka and Kerala clusters over the next 3-4 years.

Outlook

Our FY27E and FY28E EBITDA broadly remain unchanged. We expect 31% EBITDA CAGR over FY26-28E. Maintain ‘Buy’ rating with TP of Rs 810/share based on 27x FY28E EV/EBITDA.

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Krishna Institute of Medical Sciences - 1002026 - prabhu