Healthcare stock with operations across hospitals, clinics, retail pharmacies, and many more in focus following a lease agreement for setting up a new Woman and Children Hospital in Hyderabad
Price Action
With a market capitalization of Rs. 21,126 Crores, the shares of Aster DM Healthcare Limited were trading at Rs. 422.95 per equity share, up 0.36 percent from its previous day’s close price of Rs. 421.45.
What Happened
Aster DM Healthcare Limited’s wholly-owned subsidiary Sri Sainatha Multispecialty Hospitals Private Limited has entered into a Lease Agreement with Aparna Constructions and Estates Private Limited for setting up new Aster Woman and Children Hospital in Hyderabad.
The agreement is for 30 years and it is obliged to pay rent based on per sq. ft. of chargeable area plus applicable taxes and pay an interest-free refundable security deposit of Rs. 9.70 crores.
As of Q1FY25, Aster DM Healthcare Limited has a bed capacity of 4,869 beds, and with the above expansion by setting up a new hospital, it will add 275-300 beds to its existing capacity in 2 phases.
Establishing a new Women & Child hospital in Hyderabad offers a strategic opportunity to address the growing healthcare needs of a rapidly expanding population, driven by urbanization and an increasing middle class with greater disposable income.
The proposed project is situated in a catchment area with a predominantly young migrant population, which further increases the demand for comprehensive women’s and children’s healthcare services.
About the Company
Aster DM Healthcare Limited is a healthcare services provider with operations across hospitals, clinics, retail pharmacies, and many more.
As of Q1FY25 Aster DM Healthcare Limited has a total bed capacity of 4,869 beds, along with an average revenue per occupied bed (ARPOB) of Rs. 44,200+, an average revenue per IP patient of Rs. 66,747+ and a 67 percent occupancy rate.
It has its presence across 5 states and 15 cities like Karnataka, Maharashtra, Kerala, Andhra Pradesh & Telangana, with more than 19 hospitals, 13 clinics, 243 Labs & PECS, and 217 Pharmacies
As per the Segment-wise revenue mix of Q1FY25, Multispecialty generates 17 percent of the revenue, Cardiac Sciences 14 percent, OP Pharmacy, Anaestheolgy 13 percent, Neuro Sciences 11 percent, Gastroenterology and Integrated Liver Care 10 percent, Oncology 9 percent, Nephrology And Urology 7 percent, Orthopaedics 8 percent, women’s Health 6 percent, and Child and Adolescent Health 6 percent.
Financials & Ratios
Its revenue from operations grew by 19.10 percent from Rs. 841 Crores in Q1FY24 to Rs. 1,002 Crores in Q1FY25, accompanied by profits of Rs. 20 Crores to Rs. 5,152 Crores.
In terms of return ratios, it has reported a return on equity (ROE) of 3.13 percent and a return on capital employed (ROCE) of 4.48 percent. In terms of liquidity, it has reported a debt-to-equity ratio of 0.42.
Written by: Bharath K.S
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