Max Healthcare: New bed ramp-up key to improve EBITDA momentum

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Max Healthcare: New bed ramp-up key to improve EBITDA momentum

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Max Healthcare

New bed ramp-up key to improve EBITDA

momentum

Reiterate Rating: NEUTRAL | PO: 1,050 INR | Price: 1,023 INR

Inline 4Q but EBITDA growth likely needs pick-up 22 May 2026

Max Healthcare operational performance was inline with expectations with EBITDA Equity

Rs6.9bn. Hospital EBITDA growth was 8% YoY with impact on onco due to the

discontinuation of high value chemo drugs. There is expectation of improving hospital

Key ChangesEBITDA growth momentum over FY27-28 (20%+ CAGR vs. 6% in 2HFY26 incl Noida acq)

given largely brownfield additions, but ramp-up of the newly added beds should be key (Rs) Previous Current

with guidance of 600 beds being commissioned in next few qtrs. While growth trends Price Obj. 1,060.00 1,050.00

should improve QoQ, the full benefit of the brownfield addition will likely reflect in 2026E EPS 19.65 20.05

2HFY27 earnings. 2027E EPS 22.54 22.89

2028E EPS 28.06 27.77

Key moving parts in 4Q

Max added ~200 new brownfield beds in Nanavati, Saket & Mohali in 2HFY26 that Neha Manpuria >>

Research Analyst

should have aided higher EBITDA growth. However, the addition of new beds has meant BofAS India

8-9% increase in ALOS YoY that impacted ARPOB growth (and occupancy). Moreover, +91 22 6632 8307 neha.manpuria@bofa.com

the company did indicate increase in doctor costs for new capacity with the ramp-up of

Charul Agrawal >>

new beds aiding operating leverage in FY27. While the qtr includes most of the benefit Research Analyst

from CGHS rate revision (Rs1bn with remaining Rs250-300Mn in 1QFY27), this was BofAS India +91 22 6632 8255

offset by the discontinuation of chemo drugs for scheme patient leading to onco IPD charul.agrawal2@bofa.com

declining by 500bps YoY.