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  • 25 May 2022
  • ICICIdirect Research

Aster reports in line quarter driven by both India, GCC

ASTERDM - 417 Change: 8.50 (2.08 %)

News: Revenues grew 14% YoY to Rs 2728 crore driven by 26% YoY growth in the India business to Rs 607 crore and 12% YoY growth in GCC business to Rs 2214 crore. In GCC, Hospitals grew 14% YoY to Rs 944 crore, Clinics grew 13% YoY to 661 crore and Pharmacy grew 9% YoY to 609 crore. EBITDA margins improved 353 bps YoY to 17% while EBITDA grew 44% YoY to Rs 463 crore. Subsequently, net profit increased by 115% YoY to Rs 226 crore. Delta vis-à-vis EBITDA was mainly due to lower interest and tax expenditure.

Views: Aster DM posted a good set of numbers with both revenues and margins being in line with I-direct estimates. On a blended level, occupancy improved to 63% in FY22 from 55% last year and ARPOBD has improved to Rs 66,000 in FY22 from Rs 65,500 last year. With GCC and India operations being mostly normalized Aster’s better performance is reflected through significant improvement for in-patient numbers at the hospitals and higher footfalls across the pharmacies and clinics. Aster owns a unique business model among Indian healthcare services providers with strong established presence in GCC and India. We are positive on Aster’s integrated business model and Aster’s growth strategy for India to add brownfield facilities with low capex investment but high potential opportunity. We expect gradual margins and RoCE improvement on the back of higher occupancy and capacity optimisation in newer assets.

Impact: Positive