Narayana Hrudayalaya - Strong Footing In Health City: Prabhudas Lilladher

Prabhudas Lilladher Report

We are increasing our FY24/25E earnings per share estimates by 3.7% and 5.8% as we factor in higher profitability from units in health city, Bangalore.

Narayana Hrudayalaya Ltd.’s profitability across India and Cayman was strong in H1 FY23 (up 44% YoY) and we expect this growth momentum to sustain.

The company plans to continue with its aggressive capex plan for next two-three years (guided capex of Rs 10 billion annually in FY23E and FY24E).\

More importantly capex spend would be towards its core and high performing regions such as Bangalore, Kolkata and Cayman. This enhances growth visibility.

We expect Ebitda compound annual growth rate of 22% over FY22-25E. Despite capex intensity going up, return on equity/return on capital employed will remain healthy at ~25%.

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