Fortis Healthcare rallies 9%, nears record high; brokerages see more upside

Business Standard

22-05-2025

Fortis Healthcare share price today: Shares of Fortis Healthcare hit a four-month high of ₹731.35, as they rallied 9 per cent on the BSE in Thursday's intra-day trade amid heavy volumes on a healthy business outlook.
The stock price of the hospital company is quoting at its highest level since January 8, 2025. It had hit a record high of ₹744 on December 30, 2024.
At 11:13 AM, Fortis Healthcare stock was trading 8 per cent higher at ₹724.20 on the BSE. In comparison, the BSE Sensex was down 0.88 per cent at 80,880.47. The average trading volumes on the counter jumped over fourfold. A combined 5.72 million equity shares representing 0.76 per cent of the total equity of Fortis Healthcare have changed hands on the NSE and BSE.
Fortis Healthcare Q4 & FY25 financial performance
Delhi-headquartered hospital chain Fortis Healthcare on Tuesday, May 20, 2025, reported a 7.4 per cent year-on-year (Y-o-Y) fall in consolidated net profit for the March quarter of financial year 2024–25 (Q4FY25) at ₹188.02 crore, down from ₹203.14 crore in the same period last year. The decline in net profit was attributed to a 13.6 per cent Y-o-Y rise in total expenses, which stood at ₹1,741.52 crore, up from ₹1,531.76 crore. The company also cited impairments on investments in an associate firm and assets in a subsidiary, according to its regulatory filing.
Revenue from operations rose to ₹2,007 crore in Q4FY25, marking a 12.4 per cent increase from ₹1,786 crore in Q4FY24. The increase in revenue was driven by strong performances in both the hospital and diagnostics businesses.
Consolidated earnings before interest, tax, depreciation, and amortisation (Ebitda) rose 14.3 per cent Y-o-Y to ₹435 crore, with the Ebitda margin at 21.7 per cent, up from 21.3 per cent in the year-ago period.
In FY25, the company's hospital business contributed 84 per cent to consolidated revenue compared to 82 per cent in FY24. Revenue from focus specialities comprising Oncology, Neurosciences, Cardiac Sciences, Gastroenterology, Orthopaedics and Renal Sciences grew 16 per cent Y-o-Y and contributed 62 per cent to overall hospital business revenues.
The management said the company has witnessed a steady improvement in the diagnostics business Ebitda margins (excluding one-offs) at 22.0 per cent in FY25 compared to 19.6 per cent in FY24. The new brand is being well accepted and gaining prominence, placing the business in a better position to drive business expansion and enhance performance metrics, the management said.
The company added 200 beds in FY25 and plans to add 993 beds in FY26, most of which are Brownfield projects.
Brokerages' view on Fortis Healthcare
JM Financial Institutional Securities - Due to ongoing efforts to improve the profitability of underperforming units, combined with significant Brownfield expansion, the company is poised to achieve over 15 per cent topline growth over the next three years, along with 200–300 bps margin expansion.
With improved profitability, the company is also expected to generate ₹3,980 crore in free cash flow over the next three years. At the Wednesday market price of ₹672, the stock is trading at 26.2x on a 1Y forward EV/Ebitda basis, which the brokerage firm believes is likely to expand in the coming years due to improving fundamentals. 'We value the company on a SOTP basis to arrive at a target price (TP) of ₹810. Maintain BUY on the stock,' the brokerage firm said in the Q4 result update.
Elara Capital - Strong growth continued in the hospitals segment. The management has guided for continued growth and a further 150- 200 bps margin expansion in FY26. Performance has started picking up in the diagnostics business as well – the management guided for double-digit growth in FY26, with margin recovering to ~23 per cent levels. 'We raise FY26E and FY27E core EPS estimates by 15-17 per cent, on strong guidance in both the business segments. So, we raise our TP to ₹749 from ₹686 – Retain Accumulate,' the brokerage firm said.
About Fortis Healthcare
Fortis Healthcare is a leading integrated healthcare delivery service provider in India. The healthcare verticals of the company primarily comprise hospitals, diagnostics and day care speciality facilities. Currently, the company operates 27 healthcare facilities (including JVs and O&M facilities). The Company's network comprises approximately 4,750 operational beds (including O&M beds) and 404 diagnostics labs.