Apollo Likely to Gain from Hospital Growth

Brokerages Upbeat on Stock with Hope of Digital Biz Breakeven

- RAM PRASAD SAHU

Results of India's largest listed healthcare company, Apollo Hospitals, for the fourth quarter of 2024-25 (Q4FY25) were a mixed bag. Revenues for the mainstay hospitals business were impacted by lower patient inflows from Bangladesh while occupancy levels too were lower on a sequential basis.

Given the expansion in bed capacity, margins are expected to come down, prompting some brokerages to cut their earnings estimates. Despite the pressure on profitability, most analysts are positive on the stock, given strong revenue growth in the hospital segment, breakeven in the digital healthcare business (Healthco), and expansion as well as margin gains in the retail healthcare segment housed under Apollo Health and Lifestyle (AHLL).

The stock is up 14.5 per cent over the past three months, and is currently trading at ₹6,913 per share.

The company delivered a 10 per cent year-on-year (Y-o-Y) growth in the hospitals business in Q4, which was below estimates due to lower patient inflows from Bangladesh. While occupancies were up by 200 basis points (bps) to 67 per cent, average revenue per operating bed (ARPOB) rose 7 per cent.