Aster DM Healthcare - Q4FY20 Result Update - ICICI Securities

Q4FY20 revenues grew 4.6% YoY to Rs. 2301 crore. EBITDA margins expanded 163 bps YoY to 17.6% mainly due to lower other expenses on Ind-AS adjustment. Subsequent EBITDA grew 15.3% YoY to Rs. 404 crore. However, PAT fell 37.4% YoY to Rs. 131 crore. Delta vis-a-vis EBITDA was mainly due to higher interest & depreciation expenses due to Ind-AS 116.

Valuation & Outlook

The ongoing Covid 19 crises has have created unforeseen hurdles in what has been a smooth journey leveraging on a blend of large hospitals, secondary clinics and a well established pharmacy business in the GCC region. Aster owns a unique business model among Indian healthcare services providers with strong established presence in GCC and India. While the India expansion remains on investment curve, firm footing and FCF generation from the GCC set-up is keeping the entire scheme of things under control, especially when the company is pursuing aggressive expansion mode in both GCC and India albeit via assets light model. Despite the capex cycle getting pushed further due to the pandemic, we are positive on the company's integrated business model and expect gradual margins and RoCE improvement on the back of higher occupancy and capacity optimisation in new assets from FY21E onwards. At current levels, we envisage favourable risk-reward matrix and maintain BUY rating with a target price of Rs. 160 (SOTP basis).

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_AsterDM_Q4FY20.pdf

Shares of Aster DM Healthcare Ltd was last trading in BSE at Rs.125.15 as compared to the previous close of Rs. 120.8. The total number of shares traded during the day was 29971 in over 742 trades.

The stock hit an intraday high of Rs. 127.5 and intraday low of 120.2. The net turnover during the day was Rs. 3741789.

Source : Equity Bulls

Keywords