ICICI Securities maintains Add on Apollo Hospitals, raises target price to Rs 7,500

ICICI Securities has maintained an Add call on Apollo Hospitals Enterprise with a revised target price of Rs 7,500 (earlier Rs 6,700). The current market price of Apollo Hospitals Enterprise is Rs 6798. Apollo Hospitals Enterprise, incorporated in 1979, is a Large Cap company with a market cap of Rs 97953.30 crore, operating in the Hospitals & Allied Services sector.

Apollo Hospitals Enterprise key products/revenue segments include HealthCare Services and Other Operating Revenue for the year ending 31-Mar-2024.

Financials
For the quarter ended 31-03-2025, the company has reported a Consolidated Total Income of Rs 5653.30 crore, up 1.12% from last quarter Total Income of Rs 5590.70 crore and up 13.70% from last year same quarter Total Income of Rs 4972.00 crore. The company has reported net profit after tax of Rs 404.00 crore in the latest quarter. The company’s top management includes Dr.Prathap C Reddy, Mr.Vinayak Chatterjee, Mrs.Rama Bijapurkar, Dr.Murali Doraiswamy, Mrs.V Kavitha Dutt, Dr.Som Mittal, Mrs.Sangita Reddy, Mrs.Suneeta Reddy, Mrs.Preetha Reddy, Mr.M B N Rao. Company has Deloitte Haskins & Sells LLP as its auditors. As on 31-03-2025, the company has a total of 14 crore shares outstanding.

Investment Rationale
ICICI Securities has increased the revenue/EBITDA/PAT estimates of Apollo Hospitals Enterprise by ~1%/6%/7% for FY26 and 6%/13%/15% for FY27, factoring in faster growth and better margins in pharmacy business. The stock currently trades at EV/EBITDA of 27.4x FY26E and 22.3x FY27E. The brokerage maintains its ADD rating with a higher target price of Rs 7,500 (earlier Rs 6,700). ICICI Securities values the hospital business at 25x FY27E EV/EBITDA, HealthCo at 2.5x FY27E EV/sales and AHLL at 18x FY27E EV/EBITDA. Downside risks include higher competition in pharmacy business; and slower occupancy ramp up at new hospitals. Promoter/FII Holdings
Promoters held 29.34 per cent stake in the company as of 31-Mar-2025, while FIIs owned 42.74 per cent, DIIs 22.1 per cent.