22-05-2025
Aster DM Healthcare Ltd (BOM:540975) Q4 2025 Earnings Call Highlights: Strong Revenue Growth ...
Release Date: May 21, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Aster DM Healthcare Ltd (BOM:540975) reported a 12% revenue growth, reaching INR 4,138 crores for the full year FY25.
Operating EBITDA grew by 30%, with margins expanding to 19.5% from 16.8% the previous year.
The company successfully reduced material costs to 20.9% of revenue, reflecting stronger procurement and pricing controls.
Aster DM Healthcare Ltd (BOM:540975) achieved a 49% increase in normalized PAT, excluding exceptional items.
The merger with Quality Care India Limited is expected to create one of India's top three hospital networks, enhancing operational synergies and financial resilience.
The Kerala cluster faced challenges due to management changes and the impact of Ramadan, affecting revenue and occupancy rates.
There was a 6% decline in inpatient volumes in Kerala, partly due to reduced medical tourism.
The Hyderabad cluster underperformed within the Care hospital chain, requiring significant leadership and operational changes.
The company experienced delays in several brownfield expansion projects, impacting timelines.
Aster DM Healthcare Ltd (BOM:540975) faced challenges in maintaining occupancy rates in certain clusters, affecting overall performance.
Warning! GuruFocus has detected 6 Warning Sign with BOM:540975.
Q: What is the expectation for the Kerala cluster's performance, considering the recent management changes and occupancy issues? A: Alicia Mooppan, Deputy Managing Director, explained that the Kerala cluster faced challenges due to management changes and the impact of Ramadan, which affected local business and medical tourism. The new leadership team is in place, and they expect improvements in the next quarter or two. The issues are seen as temporary, and the team is confident about returning to growth soon.
Q: What steps have been taken to improve the underperforming Hyderabad cluster within the Care Hospital chain? A: Varun Kanna, Group MD of Quality Care, stated that significant efforts have been made, including leadership changes, clinical recruitment, and operational efficiency improvements. The Banjara facility has been renovated, and these initiatives are expected to lead to a significant turnaround in the Hyderabad cluster's performance.
Q: How is Aster DM Healthcare planning to expand its Medical Value Travel (MVT) segment, given the challenges in traditional markets like Maldives? A: Alicia Mooppan, Deputy Managing Director, mentioned that the focus is on opening new markets and strengthening the MVT team. They are looking at African countries and Iraq as potential markets and are working on a structured approach to diversify the MVT patient portfolio.
Q: What is the strategic outlook for Aster DM Healthcare's clusters in Kerala, Andhra, and Karnataka for FY26? A: Ramesh Kumar, COO, outlined that in Karnataka and Maharashtra, they are focusing on growth through bed additions and specialty expansions. In Kerala, the focus is on leadership strengthening and specialty growth, particularly in oncology. In Andhra, they are expanding specialties like oncology and cardiology and adding more clinicians to drive growth.
Q: What are the expected synergies from the merger with Quality Care India Limited (QCIL), and how will they impact financial performance? A: Varun Kanna, Group MD of Quality Care, highlighted that synergies are expected primarily from procurement, repair and maintenance contracts, and food and beverage operations. These synergies are anticipated to contribute significantly to EBITDA improvements, with a run rate of INR 20 crore expected in Q4 FY25.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
