'Buy' Medanta Shares Maintains Motilal Oswal; Target Of Rs 1,590

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Motilal Oswal Report

Medanta owner Global Health Ltd. has been making inroads into a new territory and establishing healthcare ecosystem in that territory. This is not only beneficial to patients (as they get enhanced healthcare services), but also enables Medanta to build a sustainable brand franchise in the long term.

We expect a CAGR of 15%/18%/25% in revenue/Ebitda/PAT over FY25-27, largely driven by the number of patients being treated.

The implementation of high-end technology and the optimization of case mix/payor mix should drive average revenue per occupied bed, reduce average length of stay, and thereby improve overall profitability for Medanta going forward.

Further, the addition of beds at the existing sites and the construction at new sites provide pathway for sustainable bed addition-led growth over the next six-seven years.

We value Medanta at 30x 12M forward EV/Ebitda to arrive at our target price of Rs 1,590. Maintain Buy.

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