On Friday, Citi increased the price target for Max Healthcare Institute Ltd (MAXHEALT:IN) to INR1,250 from INR930, while reiterating a Buy rating on the stock. The revision reflects the company's robust revenue growth and the progress of its expansion projects.
Max Healthcare reported a 22% year-over-year increase in revenue, a portion of which was attributed to inorganic growth. EBITDA rose by 15% year-over-year, even after accounting for losses at Dwarka and costs related to acquisitions, which had an approximate INR250 million impact. When normalized for these factors, EBITDA growth was 21% year-over-year.
The company's recent acquisitions, including those in Jaypee, Lucknow, and Nagpur, have not only enhanced the growth outlook but also demonstrated Max Healthcare's strategic use of its balance sheet. These acquisitions are in line with the healthcare provider's ongoing expansion projects, which remain on schedule.
The analyst's commentary highlighted the company's strong financial performance and its effective strategy in utilizing its balance sheet for growth. The positive outlook is underpinned by Max Healthcare's ability to integrate acquisitions and drive forward its expansion initiatives.
With the raised price target to INR1,250, Citi signals confidence in Max Healthcare's continued growth trajectory and its operational capabilities. The company's current trajectory aligns with the analyst's expectations, as indicated by the maintained Buy rating.
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