Fortis Healthcare (FORTIS) Q2 26/27 earnings summary

Executive summary

• Q2FY27 revenue rose 17.3% YoY to ₹2,734.83 Cr; operating EBITDA pre-ESOP increased 19.2% to ₹663 Cr, and adjusted PAT grew 4.0% to ₹317 Cr.

• H1FY27 revenue grew 17.4% to ₹5,279.86 Cr; adjusted PAT was ₹581 Cr versus ₹559 Cr, with hospitals the main growth driver.

Financial highlights

• Q2 adjusted PBT increased 6.8% to ₹429 Cr from ₹402 Cr; adjusted PAT margin was 11.6% versus 13.1%.

• Consolidated Q2 EBITDA was ₹629.90 Cr at a 23.0% margin; H1 EBITDA was ₹1,181.49 Cr at a 22.4% margin.

• Q2 reported net profit was ₹320.47 Cr versus ₹328.82 Cr YoY; EPS was ₹4.14 versus ₹4.26.

• Q2 operating EBITDA pre-ESOP margin improved to 24.2% from 23.9%; hospital operating EBITDA was ₹545 Cr at a 23.3% margin, up from 22.9%.

• ESOP expense reduced reported EBITDA by an amount equivalent to 1.5% of revenue; FY27 ESOP cost was expected to be ~₹140 Cr, subject to revenue growth.

Outlook and guidance

• FY27 hospital EBITDA margin is expected to be flattish at ~22% post-ESOP; no forward-year margin guidance pending clarity on regulatory impacts.

• Prior FY29 margin guidance of 29% remains achievable if regulatory changes have no impact; management expects to assess effects and recovery over time.

• Bed aspiration is ~12,000 over 3–5 years from current capacity of ~6,300; the pipeline includes ~1,900 brownfield, ~1,600 O&M and ~2,200 inorganic beds.

• Diagnostics FY27 growth outlook remains 12%–13%; growth is expected to strengthen to mid-teens in coming quarters, then target a return to industry growth.

• ~2,000 contracted or pipeline beds are expected over 3–4 years, mostly brownfield; the 400+ bed Ashok Vihar project is additional and expected to commence in 3–4 years, subject to approvals.