Aster DM Healthcare Q1 Results Review - Strong Growth Across GCC Segments: Prabhudas Lilladher

Prabhudas Lilladher Report

Aster DM Healthcare Ltd.’s FY24E and FY25E Ebitda stand increased by 4-5%. The company’s consolidated Ebitda (Post Indian accounting standard) grew 33% YoY (down 23% QoQ) to Rs 3.9 billion; 13% above our estimates.

Aster DM has a unique business model with presence in India and an established business with strong returns in GCC. We expect 17% Ebitda compound annual growth rate over FY23-25E, as margin in its India business will gradually improve with brownfield expansion and new hospitals ramp-up in GCC.

At current market price, the stock trades at an attractive valuation of nine times FY25E enterprise value/Ebitda (Pre IND AS), which is at 25-50% discount to Indian peers.

Timely stake sale of GCC business will re-rate and lower gap with peers.

We maintain our ‘Buy’ rating with target price of Rs. 345/share (earlier Rs 335/share) based on 18 times FY25E EV/Ebitda to India business and eight times EV/Ebitda to GCC business

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