Prabhudas Lilladher's research report on Narayana Hrudayalaya
Narayana Hrudayalaya (NARH) reported another quarter of healthy EBITDA at Rs2.76bn (up 8% QoQ), 5% beat to our estimate. Both India (Rs1.65bn; flat QoQ) and Cayman ($12.5mn; up 9% QoQ) reported healthy profitability. We expect this growth momentum to sustain. The company also plans to continue its aggressive capex plan with guided capex of Rs.11bn in FY24E mainly towards its core and high performing regions such as Bangalore, Kolkata and Cayman.
Outlook
We maintain ‘BUY’ rating with TP of Rs. 980/share, based on 20x FY25E EV/EBITDA for India business and 12x EV/EBITDA for Cayman hospitals. At CMP, stock is trading at attractive valuations of 15x EV/EBITDA (adj for IND AS) and 23x P/E on FY25E. Faster ramp up in new Cayman unit will be a key.
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