Buy Max Healthcare Institute; target of Rs 610: Prabhudas Lilladher

Prabhudas Lilladher's research report on Max Healthcare Institute

Max Healthcare Institute (MAXHEALT) reported EBIDTA of Rs4.3bn (up 6% QoQ) came 4% above our estimates, aided by higher ARPOB of Rs.74.8k in Q1 vs Rs.70.7k in Q4. The company showed phenomenal growth in past two years and we expect this momentum to continue given 1) strong expansion plans (+1500 additional beds by FY25E end), 2) improving payor mix (15% revenue contribution from institutional by FY25E vs 18.4% now) and 3) scale up in labs. Operational efficiency has also been commendable, especially in competitive markets like NCR.

Outlook

Our FY24E/25E EBIDTA broadly remain unchanged and expect 15% EBIDTA CAGR over FY23-25E. We ascribe 27x EV/EBIDTA (25x earlier) based on FY25E. Maintain ‘BUY’ rating with a revised target price of Rs. 610/share (earlier Rs 565/share).

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