This company is a leading healthcare provider known for its hospitals and innovative medical services. In a strategic move to unlock value, it plans to spin off its digital health, pharmacy, and telehealth divisions into a new entity through a direct listing. The restructuring aims to merge existing units, targeting significant revenue growth, with projections reaching Rs. 25,000 crore by FY27.
Apollo Hospitals Enterprise Limited’s stock, with a market capitalisation of Rs. 1,07,090 crores, rose to Rs. 7,584.50, hitting a high of up to 4.73 percent from its previous closing price of Rs. 7,242. Furthermore, the stock over the past year has given a return of 21.30 percent.
Company Listing
Apollo Hospitals has proposed a major restructuring plan to unlock value by creating a new entity, NewCo, through the demerger of its omnichannel pharmacy distribution, digital health platform (Apollo 24|7), and remote telehealth divisions. This move includes the merger of Keimed into NewCo, forming a large listed player with expected FY25 revenues of Rs. 16,300 crore and targeting Rs. 25,000 crore by FY27, with healthy margins of ~7%. Shareholders of Apollo Hospitals (AHEL) will receive 195.2 shares of NewCo for every 100 shares held, with the combined entity expected to list in the next 18–21 months.
The transaction follows a Rs. 2,475 crore investment from Advent and aims to consolidate Apollo’s pharmacy business under one umbrella. Regulatory approvals are in progress, with valuation and fairness opinions provided by KPMG, BDO, and Axis Capital. Shareholder approval for the composite scheme is expected by February 2026, following clearances from SEBI, CCI, and NCLT. Additionally, Apollo plans to acquire full ownership of its front-end pharmacy business by buying the remaining stake in Apollo Medicals Pvt Ltd.
How Much Will Apollo Hold?
Apollo Hospitals Enterprise Ltd (AHEL) will retain a ~15% direct stake (17.5% including indirect interest) in the newly formed entity, NewCo, which will operate as an integrated healthcare platform.
This structure allows AHEL to focus on core healthcare services while NewCo enhances customer reach via an omni-channel model. The setup supports continued synergies between both entities, with AHEL having one nominee director on NewCo’s board. All inter-company dealings will follow arm’s length terms and require board approvals.
Q4 Financial Highlight
In Q4FY25, the company reported a revenue of Rs. 5,592 crore, marking a 13.1 percent YoY growth from Rs. 4,944 crore in Q4FY24 and a slight 1.2 percent QoQ rise from Rs. 5,527 crore in Q3FY25. The steady revenue growth reflects the company’s consistent performance, supported by a 3-year sales CAGR of 14 percent.
Net profit for the quarter stood at Rs. 414 crore, showing a 60.5 percent YoY jump from Rs. 258 crore and a 9.2 percent QoQ increase from Rs. 379 crore. The strong bottom-line growth is backed by a 3-year profit CAGR of 20 percent, with a healthy 3-year ROE CAGR of 16 percent, indicating improving profitability and return ratios over time.
Written By Fazal Ul Vahab C H
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Trade Brains Technologies Private Limited or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
