Broker’s Call: Global Health (Hold)

Medanta reported robust financial performance in Q1FY27, with revenue increasing by 26.5% year-on-year to ₹1,304 crore. Growth was fueled by a 21% rise in occupied bed days and a 5.5% increase in ARPOB to ₹70,244. Occupancy stood at 66%, influenced by the expansion of the Noida hospital, while established hospitals maintained strong performance.

The total bed count grew by 6.8% to 2,851. EBITDA amounted to ₹287 crore, maintaining a consistent 22% margin from the previous year, largely attributable to reduced operating losses at the newly operational Noida hospital. Noida itself reported a ₹5 crore EBITDA loss, a marked improvement from the ₹23.6 crore loss in Q4FY26. The company added 51 beds during the quarter, raising its current capacity to 433 beds.

Key empanelments with insurance companies, PSUs, and corporates have been finalized, with management anticipating the hospital to achieve EBITDA breakeven sooner than initially projected. Management remains focused on driving sustainable, volume-led growth across its 3,350-bed pipeline, aiming to restore consolidated EBITDA margins to the 25-26% range as new assets come online.

The strategy emphasizes high-acuity complex care, including oncology, robotic surgeries, and organ transplants, alongside an expanding international patient base. This approach aims to foster steady single-digit growth in ARPOB through a more diversified case mix, rather than relying on substantial tariff increases.