Apollo Hospitals beats estimates in Q3, as specialty care continues to drive growth

Apollo Hospitals on Tuesday beat Street forecasts for the quarter ended December, driven by strong demand for specialty care and double-digit business growth. The hospital chain reported the following revenue: ₹6,477 crore, up 17% year-on-year, while profit after tax increased 35% ₹502 crore.

Earnings before interest, taxes, depreciation and amortization (EBITDA) increased by 27% ₹965 crore and its margin increased slightly to 14.90% (13.78%) a year ago.

Brokerage firms participating in the survey Bloomberg He predicted that revenue would increase ₹6,326.5 crore and PAT ₹489.6 crore.

Dr Madhu Sasidhar, chief executive officer, said: Mint It was stated that the growth was supported by highly specialized service lines, especially CONGO specialties and transplants. CONGO refers to the cardiac, oncology, neurosciences, gastroenterology and orthopedics departments, which have now become an important growth factor for the chain.

Growth in the December quarter, which is typically not seasonally strong growth for the hospital, “isn’t a one-off, it’s more like it” [due] “From how we hire, how we invest in infrastructure, and even how we set up our marketing, sales and digital activities, to a very high level of intent,” he said.

The decline in seasonal infections in the previous quarter was also overshadowed by growth in CONGO specialties, with revenue up 13% compared to the previous year. In its investor presentation, the company said revenues from its CONGO specialties rose 16% in the reporting quarter.

Sasidhar said high-complexity, multidisciplinary care will continue to be a focus and growth driver for the hospital, which includes CONGO departments as well as other areas such as critical, high-complexity care. “So that’s an area of ​​focus. But we also operate a number of hospitals in different geographies and different markets, in Tier II and III markets, where there will be a significant mix of medical and surgical CONGO, but also low complexity care.”

Notably, growth was primarily driven by existing beds, as incremental bed additions came into play towards the end of the quarter. “Additional beds will also have an impact in the future,” Sasidhar said.

In the third quarter, Apollo had beds made in Pune; Hospitals will be commissioned in Hyderabad, Kolkata and Bengaluru this quarter. Apollo Hospitals had previously announced plans to add more than 3,500 beds over the next five years. ₹5,400 crore.

Business gain

Apollo’s hospital services business posted 14% revenue growth ₹3,183 crore while PAT is ₹422 crore, up 21%.

Its retail and diagnostics arm, Apollo Health and Lifestyle Ltd, saw a 20% increase in revenue, driven primarily by growth in diagnostics. The company said its top-line revenue and EBITDA increased 20% and 19%, respectively, year-on-year, thanks to increased corporate and partner support.

Digital health and pharmacy distribution business revenue increased 20% ₹2,827 crore. The company reported a net addition of 487 stores in the nine months ending in December, while online drug transactions rose 31% during the same period.