Aster DM Healthcare (ASTERDM) Investor Presentation summary

Industry and market overview

• India's healthcare delivery market is projected to exceed $100 billion by FY26, driven by a large population, low hospital bed density, and rising healthcare expenditure.

• Out-of-pocket expenses remain high, but health insurance coverage is expected to expand to 46% by FY25.

• Medical tourism and an aging population are additional growth drivers for the sector.

Business profile and strategy

• Operates 19 hospitals, 13 clinics, 232 labs/PECS, and 215 pharmacies across 15 cities in 5 South Indian states, with 4,867 capacity beds and 68% occupancy in FY24.

• Second largest hospital network in South India, with leadership in Kerala and strong presence in Karnataka, Maharashtra, Andhra Pradesh, and Telangana.

• Business model is de-risked with diversified revenue across geographies and specialties; 58% of revenue comes from niche specialties.

• Asset-light O&M model enables expansion into suburban areas at minimal cost, with 538 beds in O&M hospitals and breakeven achieved in Q4 FY24.

• Strategic focus on brownfield/greenfield investments, specialty mix improvement, cost initiatives, and digital health expansion.

Financial and operational performance

• FY24 revenue reached INR 3,699 crore (24% YoY growth), with operating EBITDA at INR 620 crore (30% YoY growth) and adjusted PAT at INR 240 crore (63% YoY growth).

• 5-year revenue CAGR at 23%, EBITDA CAGR at 38%, and ROCE improved to 16.4% in FY24.

• ARPOB rose to INR 40,100+ and occupancy to 68% in FY24; patient volumes and bed capacity have steadily increased.

• Mature hospitals (over 6 years) delivered 22.4% EBITDA margin and 32% ROCE in FY24.

• Net debt/EBITDA (pre-IndAS) improved to 1.1x as of Mar'24.