Buy Max Healthcare Institute; target of Rs 675: Prabhudas Lilladher

Prabhudas Lilladher's research report on Max Healthcare Institute

Max Healthcare Institute (MAXHEALT) reported EBITDA of Rs4.9bn (up 13% QoQ) which came 7% above our estimates, aided by healthy ARPOB at Rs.74.6k and better margins. The company showed phenomenal growth in past two years and we expect this momentum to continue given 1) strong expansion plans (+2000 additional beds over FY23-26E), 2) improving payor mix (15% revenue contribution from institutional by FY25E vs 17.9% now) and 3) scale-up in labs. Operational efficiency has also been commendable, especially in competitive markets like NCR. Our FY24E/25E EBITDA increased by 5%/4% and we expect 18% EBITDA CAGR over FY23-26E.

Outlook

We ascribe 26x EV/EBITDA based on Sept 2025E EBITDA. Maintain ‘BUY’ rating with revised target price of Rs. 675/share (Rs610 earlier) as we roll forward.