Prabhudas Lilladher's research report on Krishna Institute of Medical Sciences
Krishna Institute of Medical Sciences (KIMS) reported EBITDA growth of 7.4% YoY, below our estimates impacted by higher losses from new units. Our FY26E EBITDA stands reduced by 5%, however FY27E EBITDA broadly remains unchanged as new units are likely to ramp up. The company is on track to commercialize greenfield expansions at Bengaluru markets by Q2FY26. 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, the management remains confident of achieving faster breakeven and +25% OPM across Maharashtra, Karnataka and Kerala clusters over the next 4-5 years. We expect 25% EBITDA CAGR over FY25-27E with healthy return ratios of ~20%.
Outlook
Maintain ‘Buy’ rating with TP of Rs815/share based on 30x FY27E EV/EBITDA. Delay in breakeven of new units will be a key risk to our call.
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