'Buy' Max Healthcare Shares Says Motilal Oswal On Positive Growth Triggers — Check Target Price

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Motilal Oswal Report

We believe Max Healthcare Ltd. is well poised for 21%/22%/27% revenue/Ebitda/PAT CAGR over FY25-27. Interestingly, the capital allocation strategy comprising brownfield/greenfield as well as the BTS model provides an earnings growth trajectory to sustain beyond FY27.

Further, it also has land parcels available to expand beds at promising locations, indicating the suitability of Max to cater to rising healthcare demands in respective locations.

Max also has a proven track record of considerably improving the performance of acquired assets, thereby providing an additional growth lever going forward as well.

Overall, we value Max Healthcare on an SoTP basis (premised on 35 times 12 months forward EV/Ebitda for the hospital business, 30x 12M forward EV/Ebitda for Max@lab, and 11x EV/sales for Max@home) to arrive at our target price of Rs 1,350.

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