Buy Max Healthcare Institute; target of Rs 1355: Prabhudas Lilladher

Prabhudas Lilladher's research report on Max Healthcare Institute

Max Healthcare Institute (MAXHEALT) reported healthy EBITDA growth of 23% YoY to Rs 6.14bn; in line with our estimates. The company showed phenomenal growth with ~19% EBITDA CAGR over FY22-25. We expect pick-up in the growth momentum given 1) strong expansion plans (+3700 additional beds over FY25-28E), 2) improving payor mix and 3) Bolt on acquisitions like recently added in Lucknow, Nagpur and Noida. Operational efficiency has also been commendable, especially in competitive markets like NCR.

Outlook

Our FY26E/27E EBITDA remains unchanged and we expect EBITDA/PAT to grow ~2x over FY25-28E. We ascribe 36x EV/EBITDA based on FY27E. Maintain ‘BUY’ rating with TP of Rs. 1,355/share.