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- 09 Jul 2024
- ICICI Securities
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SHALBY Q1FY25- REVENUES GROWTH STRONG BUT MARGINS STILL MUTED
SHALBY - 182 Change: -2.92 (-1.58 %)News: Revenues grew ~18% YoY to ₹ 279 crore, driven by both Hospitals and Implant segments. Hospitals grew ~16% YoY to ₹ 254 crore, driven by 14% ARPOB growth (₹ 43365). Implants (Shalby Consensus) sales grew ~53% YoY to ₹ 25 crore driven by higher implant volumes. EBITDA growth was comparatively muted at ~7% YoY to ₹ 45 crore and EBITDA margins declined 172 bps to ~16%. Lower EBITDA growth was attributable to higher RM and other expenses. Hospitals margins stood at ~19% while Implant business reported loss t EB ITDA level.
Views: The performance was slightly better on revenues front but lower on the EBITDA front. Shalby is making right strides with calibrated growth based on asset-light franchisee-based expansion in tier II-VI towns and a select big ticket expansion in metros and tier I cities. Shalby recently acquired Gurugram based Sanar International Hospital (P K Healthcare Pvt Ltd.) for a consideration of ₹ 102 crore. The hospital generates around 70% business from international markets catering to more than 60 countries. Similarly, it plans to add 40 franchisees over the next 4-5 years. For Implants business, after a tough FY24, the company has chalked out aggressive global expansion plans. We continue to monitor progress on the margins front as the margins have been treading at the sub-optimum levels in the back-to-back quarters.
Impact: Neutral