Yatharth Hospital & Trauma Care Services LtdQ2 FY24
Yatharth Hospital & Trauma Care Services Ltd Q2 FY24 Earnings Call Analysis
Revenue, margin, capex, fundraise and order book outlook from management commentary.
Price: ₹837P/E: 47.0Market Cap: ₹7.9K CrSector: Healthcare Services
Management growth scorecard
Revenue
Category 2
Margin
Category 3
Fundraise
Yes
Order
N/A
Capex
Yes
2 of 4 growth signals are positive.
Full analysisRevenue guidance
Category 2- →Expect revenue close to INR 1000 crores this year, driven by growth across facilities (Page 17).
- →Inpatient volume grew 28% YoY to 15,235 this quarter, with notable growth in Noida Extension (81% revenue increase, 38% contribution) (Pages 5, 9).
- →ARPOB (Average Revenue Per Occupied Bed) is improving, reaching INR 30,551 in Q1; expected to increase further with improved case mix and pricing (Pages 5, 17).
- →Capacity expansion underway: 200 beds in Greater Noida and 250 beds in Noida Extension planned within 2-2.5 years, expected to achieve over 50% utilization within two years post-expansion (Pages 11, 17).
- →Addition of 3,000 beds targeted by FY 2028 via brownfield expansions, acquisitions, and O&M models, primarily in North India, Delhi NCR, UP, and Rajasthan (Pages 7, 11-12).
- →Faridabad hospital occupancy to grow from current 10% to 30% by year-end, contributing to revenues (Page 10).
- →Oncology and super-specialty services expected to increase contribution and ARPOB, supporting volume growth (Pages 5, 9).
Margin guidance
Category 3- →Noida Hospital has peaked with little growth expected; any growth driven by clinical mix changes resulting in single-digit increases in ARPOB.
- →EBITDA margins across existing facilities (excluding the loss-making Faridabad hospital) expected to be stable or improve, maintaining above 26-26.5%.
- →Faridabad hospital anticipated to reach above 20% EBITDA margins within 3 years, aided by increasing ARPOB and robotic surgeries.
- →Overall consolidated margins expected to sustain around 25%, with minor fluctuations due to new acquisitions and expansions.
- →ARPOB is on an improving trajectory, crossing INR 30,000 mark recently; Jhansi-Orchha ARPOB expected to rise to INR 15,000-18,000.
- →Expansion plans to add 450 beds at Noida Extension and Greater Noida within 2-2.5 years, driving future revenue growth.
- →Oncology segment growing well, contributing 10% overall and projected to increase further.
- →EBITDA expected to improve as new capacities ramp up and operational efficiencies are realized.
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Fundraise plans
Yes- →The company currently has cash of INR 1,826 million and has reduced finance costs after IPO, improving capital efficiency.
- →Future expansions, including adding roughly 450 beds at Greater Noida and Noida Extension in 2-2.5 years, are expected to be funded largely through internal accruals.
- →There is scope for taking on additional debt if required, though efforts are made to utilize internal accruals and existing cash.
- →The company is also exploring acquisition opportunities, including operational and management (O&M) models, which require less capital outlay.
- →Overall, the financing strategy for growth includes a mix of internal accruals, available cash, and selective debt, with no specific mention of planned equity fundraising in the near term.
Order book
- →The company has a strong pipeline for future expansions, including targeting a bed capacity of 2,800 to 3,000 beds by FY '28, nearly doubling current capacity.
- →Expansion plans focus on North India markets: Delhi-NCR, Uttar Pradesh, Punjab, and Bihar.
- →Land parcels adjacent to Noida Extension and Greater Noida hospitals will see capacity additions of 250 beds and 200 beds respectively, expected to be ready in about 2.5 years.
- →Discussions are ongoing for acquiring or operating a 400-bed hospital under an O&M (Operations & Management) model, which requires lower capital expenditure.
- →The company plans at least one acquisition each year in the next few years in the target regions.
- →Funding for these expansions will come from a mix of internal accruals, cash on books, and debt if required.
- →Current consistent progress on various expansions and acquisitions indicates a solid orderbook pipeline.
Capex plans
Yes- →Brownfield expansions at Noida Extension and Greater Noida hospitals: adding 250 beds at Noida Extension and 200 beds at Greater Noida, expected in 2-2.5 years, with capex around INR 65 lakh per bed funded through internal accruals.
- →Capex increased by INR 60 crores this quarter primarily due to medical equipment including robotics and advanced surgical tools for neurosurgery and cardiac surgeries.
- →Strategic investments in robotics and super-specialty services, including oncology and organ transplant programs.
- →Plans for further bed capacity expansion aiming to reach 2,800 to 3,000 beds by FY '28 through a mix of internal accruals, debt, and O&M model acquisitions to limit asset-heavy outflows.
- →Ongoing efforts to acquire new hospitals, with recent acquisitions in Jhansi-Orchha and Faridabad, and active discussions for two more hospitals in Delhi NCR and Uttar Pradesh.
- →Signing NDA with major audit firms for process strengthening, indicating strategic governance investments.
How does Yatharth Hospital & Trauma Care Services Ltd rank vs peers in Healthcare Services?
Pro feature1Yatharth Hospital & Trauma Care Services Ltd
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