Max Healthcare Confident Of Adding 1,500 Beds In FY26: CMD Abhay Soi

Max Healthcare Institute Ltd. is embarking on a major expansion drive, aiming to roll out an "immense amount of capacity" over the next six months, according to its Chairman and Managing Director, Abhay Soi. He is confident that the company will achieve its target of adding 1,000 brownfield beds and 500 greenfield beds in FY26.

“I think we are pretty much on target. We should have all of the thousand beds rolled out within this quarter.  As far as the greenfield is concerned, which is Gurgaon, it should be at the end of the financial year. We are going to be rolling out an immense amount of capacity in the next six months,” he told NDTV Profit on Tuesday.

“Largely being brownfield capacity addition, I believe it should be extremely accretive to both the top and the bottom line,” he added.

He mentioned that minor delays are possible because of Delhi’s winter pollution-related construction bans. “Each project is a three-year project. So, you know, a few weeks up and down doesn't really move the needle on it, at least from our standpoint.”

When questioned whether this rapid expansion would dilute the Average Revenue Per Occupied Bed (ARPOB), Soi was firm that ARPOB is a "derived number" and not the company's primary metric.

“When you have significant capacity expansion, like we had 30% last year, we have another 30% capacity expansion (this year). When you put up new capacities, you're obviously going to operate at lower ARPOBs to begin with. Having said that, ARPOBs are not something that one needs to worry about. It is eventually a derived number,” he explained.

The main focus, he outlined, is on the Return on Capital Employed (ROCE).

"What we need to be focused on is the ROCE, whether we can deploy capital and whether that capital will give us attractive returns," he explained. Soi confidently stated that achieving an ROCE northwards of 20% is "absolutely" possible, consistent with the company's performance over the last five to six years.

Looking at the long-term growth prospects, Soi predicted a "multi-decade growth opportunity" for the sector, driven primarily by India's demographic dividend.

“Our average age is 29. This population is becoming older. Ten years later, it will be ten years older. We'll need to go to hospitals a lot more.”

“It's also a development challenge which our sector is going to face, which our country is going to face. And each one of the players is incumbent upon them to meet this challenge. You know, if not us, who?” he concluded.

Shares of Max Healthcare Institute closed 0.57% lower at Rs 1,115.2 apiece on the NSE, while the benchmark Nifty50 ended at 25,910.05, down 0.4%.