Narayana Hrudayalaya Ltd. share price forecast

Narayana Health Ltd (NH) is a chain of multi-specialty hospitals operating in India and the Cayman Islands. NH revenues in Q3FY22 grew by 28% YoY to Rs.960cr during the...

Prince Pipes: We maintain our BUY rating on Prince Pipes, with an unchanged target price of INR 940/sh (18.5x its Dec-23E EBITDA, implying 31x P/E). We continue to like Prince for its large product portfolio and robust pan-India distribution. The Lubrizol deal should further contribute to its industry leading growth. In Q3FY22, while weak demand led to 12% YoY volume decline, improving product mix helped the company deliver gross margin expansion (on per kg basis). This offset the impact of op-lev loss and elevated other expenses. Subsequently, revenue/EBIDTA/APAT rose 21/8/1% YoY. Mahindra Lifespaces: Mahindra Lifespaces Developers Ltd (MLDL) reported strong sustenance presales of 0.32msf (+3.2%/-18% YoY/QoQ), valued at INR 2.5bn (+28%/-17% YoY/QoQ). The IC&IC segment saw strong performance, with 51.1acres leased for INR 1.4bn. MLDL believes this performance is not a one-off and would sustain. The run-rate and enquiries in this segment are now better than pre-COVID levels. The segment also expects to benefit from the proposed legislative changes for SEZs in the recent budget, with MWC Jaipur expected to benefit the most. On new land/gross development value (GDV) addition, MLDL expects to close INR 20bn of GDV by Mar/Apr-22. Further, it is in advanced talks on projects in the INR 80bn worth of prospect pipeline, which may add INR 20-25bn GDV in FY23E. It has taken price hikes across projects (~1.5% hike every quarter). Given the tailwinds in industrial business, a robust balance sheet, trustworthy brand image, and a strong pipeline, we remain constructive on MLDL and maintain a BUY rating, with an unchanged NAV-based...

Revenue mix Q3FY22 India: | 771.7 crore; (Bangalore:34%, Southern Peripheral:7%, Kolkata:26%, Eastern Peripheral: 5%, Western: 15%, Northern: 13%); Cayman Islands: US$24.9 million Q3FY22 Results: NHL reported strong numbers led by flagship hospitals amid...

Narayana Health Ltd (NH) is a chain of multi-specialty hospitals operating in India and the Cayman Islands. NH revenues grew by 57% YoY to Rs.940cr during the quarter as the Indian operations staged a decent recovery aided by the international...

Apollo Hospitals is an integrated healthcare services provider, which is undergoing an optical transformational journey towards creating an omnichannel healthcare platform along with turning the new hospitals, ventures profitable on the back of a judicious case mix besides better occupancy &...

Narayana Health Ltd (NH) is a chain of multi-specialty hospitals operating in India and the Cayman Islands. NH revenues in Q1FY22 grew by 118% YoY to Rs.859cr during the...

Gujarat State Petronet: Our BUY rating on Gujarat State Petronet with a TP of INR 400 is premised on (1) robust transmission volume growth (+11% CAGR over FY21-23E to 45mmscmd) with increase in gas supply from domestic sources. This should drive volumes and translate to growth in standalone EBITDA at 15% and APAT at 19% CAGR to INR 19bn and INR 13bn in FY23E and (2) compelling valuation at 7.9x FY23E EPS, considering high RoE of 24% in 23E and combined FCF of INR 45bn over FY22-24E. Narayana Health: Narayana Health's (NH) Q1 EBITDA beat estimates by 10%, mainly driven by improved trajectory in the Cayman Islands business (+25% QoQ, 47% margin). COVID has impacted the India business recovery (-3% QoQ), as expected. However, barring the flagship units, the other mature/new units demonstrated robust performance with flat/+870bps QoQ improvement in margin. Despite easing of travel restrictions, NH has been able to sustain patient flow in Cayman Islands, which is encouraging. In India, it plans to increase investments to refurbish and add service offerings at current facilities, which would improve ARPOBs in the long term. While this may increase debt in the near term, the overall net debt/EBITDA would remain comfortable at 1.6x/1.4x for FY22/23e. We raise EBITDA estimates for FY22/23 by 12-13% to factor in higher margin in Cayman Islands and revise the TP to INR575/sh. ADD. Sudarshan Chemical: We maintain a BUY recommendation on Sudarshan Chemical (SCIL) with a target price of INR 830/share. We expect SCIL's PAT to grow at a 26% CAGR over...

Narayana Hrudayalaya Ltd (NH) is a chain of multi-specialty hospitals operating in India and the Cayman Islands. NH revenues in Q4FY21 grew by 12.8% YoY to Rs.838cr with strong...

We increase our EBITDA estimates for FY22/23e by 2%/8% to factor in healthy recovery trends in India. However, at the CMP of INR505/sh., the stock is trading at ~15x FY23e EV/EBITDA, which limits the scope of further re-rating. Downgrade to ADD. Narayana Health (NH) Q4 results were strong with EBITDA at INR1.4bn (+48% YoY, +34% QoQ) vs. our expectation of INR1.1bn. The beat was largely driven by strong recovery in India business (pick-up in elective surgeries, lower COVID contribution) and continued momentum in Cayman Islands (40.5% EBITDA margins vs. 25% in FY20). We expect recovery trends to continue in India (barring Q1FY22) with flagship units (40%+ of revenues) growing in high single digit (on a low base), other mature units growing in low double digits and new units (ex-SRCC) turning profitable by FY23. NH expects moderation in Cayman Islands margins as travel restrictions ease

Blended model of affordable + high-quality services The company has a legacy model based on affordability over the years. Due to strict control over costs and capital, Narayana was making reasonable profit. However, as it looks to scale up in other regions, where the consideration for quality has more weight than affordability, the model is likely to be modified from 'affordable'' to a mix of affordable + quality at premium. Cases in point are the recent acquisition of Gurugram Hospital and buying out of partner in the Cayman Islands hospital internationally where...

We believe Apollo is the best play on India healthcare, given its pan-India presence, expanding avenues for growth (pharmacy, diagnostics, Apollo 24/7) and balance sheet strength. However, at 19x FY23e EV/EBITDA, ~25-30% premium to its historical average, the positives appear priced in. We like Narayana's India hospital franchise and believe it is poised to emerge stronger with ROCE expanding by ~450bps to 14% over FY20-23; the proposed expansion at Cayman is return dilutive in the near term, but NPV accretive (Rs25/sh), in our view. The stock is trading at attractive valuation of 14x FY23e EV/EBITDA, ~10-15% discount to its historical average The structural shortage of healthcare infrastructure, low government spending and attractive demographics presents huge growth opportunity for private players. Most listed players aggressively expanded capacity from FY12-18 and are treading on path of consolidation. The Capex trends have moderated since FY20 and may continue to remain so in the next two years. Post pandemic, the recovery trends are encouraging with large players having gained market share. More importantly, despite the tough environment, the balance sheets remain comfortable with stable net debt positions. With gradual recovery in FY22, we forecast ~15% EBITDA CAGR and ~435bps expansion in ROCE to 15% over FY20-23e for the covered stocks, driven by improving occupancy and ARPOB, strong growth in other businesses and calibrated Capex spends.

Narayana Health Ltd (NH) is a chain of multi-specialty hospitals operating in India and the Cayman Islands. NH operates 47 healthcare facilities including hospitals, clinics and heart centres with 6,656 capacity beds and 30+ specialities. The company has a strong track record of providing quality healthcare services at an affordable cost. Over the last 5 years, NH has focused on increasing its presence at...

The expansion at Camana Bay is likely to improve HCCI's reach to patients both international and local, due to close proximity to the airport and several major residential complexes. Significant capital outlay notwithstanding, the new facility would complement the existing set up by focusing more on day care, short stay but niche categories of oncology care while the existing facility would continue to cater to tertiary and quaternary care. We expect the impact of this blended model to materialise from FY23 onwards. NH's experience in running hospital in this region could be handy...

Blended model of affordable + high-quality services The company has a legacy model based on affordability over the years. Due to strict control over costs and capital, the company was making reasonable profit. However, as it looks to scale up in other regions, where the consideration for quality has more weight than affordability, the model is likely to be modified from 'affordable'' to a mix of affordable + quality at premium. Cases in point are the recent acquisition of Gurugram Hospital and buying out of partner in the Cayman Islands hospital internationally where...

Blended model of affordable + high-quality services The company has a legacy model based on affordability over the years. Due to strict control over costs and capital, the company was making reasonable profit. However, as it looks to scale up in other regions, where the consideration for quality has more weight than affordability, the model is likely to be modified from 'affordable'' to a mix of affordable + quality at premium. Cases in point are the recent acquisition of Gurugram Hospital and buying out of partner in the Cayman Islands hospital internationally where...