KIMS Q3 Results Review - Weak Quarter; Negative Operating Leverage: Prabhudas Lilladher

Prabhudas Lilladher Report

Krishna Institute of Medical Sciences Ltd.'s Q3 operating performance stands impacted (Ebitda de-grew at 3% YoY to Rs 1.5 billion) from certain one offs such as

1. state elections,

2. cyclone,

3. weak season and

4. shifting of Sunshine unit.

However robust cost control, low capital intensive set-up and value accretive acquisitions have ensured good profitability in the past (with Ebitda growth of 34% compound annual growth rate over FY18-23).

Recent acquisitions of Sunshine, Nashik and Nagpur are value accretive which will continue to aid growth momentum, in our view.

We expect 17% Ebitda CAGR over FY24-26E with healthy return ratios of ~20%. Our FY24E/FY25E Ebitda estimates broadly remain unchanged.

Maintain ‘Buy’ rating with target price of Rs 2,200/share (earlier Rs 2,000) based on 22 times FY26E enterprise value/Ebitda as we roll forward.

Any delay in expansion plan will be key risk to our call.

Click on the attachment to read the full report:

DISCLAIMER

This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.

Users have no license to copy, modify, or distribute the content without permission of the Original Owner.