Apollo Hospitals reported in line set of numbers with a slight miss which was attributable to lower than expected AHLL performance.
Q4FY23 Earnings Summary
Revenues grew 0.9% QoQ to Rs 4302 crore (I-Direct Estimates- Rs4489 crore), mainly supported by hospitals as well as Pharmacy business
EBITDA declined 3.4% QoQ to Rs 488 Crore (I-Direct Estimates- Rs532.6 crore). EBITDA Margins declined by 51 bps to 11.3% (I-Direct Estimates- 11.9%), due to higher employee expenses
PAT declined 5.9% QoQ to Rs 145 crore
Healthcare services division (Hospitals): It was up 1.5% QoQ to Rs 2227.4 (I-Direct Estimates-Rs 2258.3 crore) on the back of growth from both new as well as existing hospitals
Occupancy in Q4FY23 for existing hospital stood at 65% whereas for new hospitals it was 62%
Top therapies such as Cardiac, Onco, Neuro, Nephro, Gastro and Ortho contributed ~ 60% of the Hospital Revenues
Hospitals EBITDA came at 24%
Pharmacy: It showed a growth of 2.4% QoQ at Rs 1799.2 crore. Revenue from digital platform came at Rs 253.9 crore whereas Offline pharmacy reported revenue of Rs1545 crore
The company added 345 net new stores during the period
GMV of Apollo 24/7 was at Rs 593 crores in Q4 FY23, compared to Rs 543 crores in Q3 FY23
Private Label / Generic Sales came at ~15.5% in FY23
AHLL: Revenues came at Rs 308.5 crore down 0.9% QoQ (I-Direct Estimates- Rs 342.9 crore)
ICICIdirect Research view on Apollo Hospitals Enterprise Ltd Stock
View: The hospitals business continues to see improved profitability with optimum case mix and payor mix. The company has embarked upon new capex plan to add 2000 beds with over Rs 3000 crore in the next 4 years in key metros. Growth in pharmacy business was also decent but the expenses related to Apollo 24x7 are expected will continue to hit the P&L for few more quarters. Structurally, cost reduction drives, expanding of complex procedures and profitability of new hospitals remain key management focus areas.
Impact: Positive
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