Max Healthcare Institute (543220) Q4 20/21 earnings summary

Executive summary

• FY21 network gross revenue fell 10.9% to INR 3,881 crore, while operating EBITDA rose 7.9% to INR 636 crore; operating margin expanded 290 bps to 17.5%.

• The Radiant merger and listing reshaped the business and financial base; a INR 1,200 crore QIP strengthened liquidity and reduced net debt.

Financial highlights

• FY21 pro forma net revenue was INR 2,798 crore, down 8% YoY; revenue from operations declined 8.9% to INR 2,682 crore, reflecting lower occupancy, ARPOB and international patient activity.

• Pro forma EBITDA was INR 482 crore versus INR 514 crore in FY20; EBITDA margin rose to 18.4% from 15.8%.

• Consolidated reported revenue from operations was INR 2,505 crore and net loss was INR 138 crore; FY21 and FY20 are not comparable due to the reverse merger and different periods consolidated.

• Exceptional consolidated costs totaled INR 234 crore, including INR 196 crore loss on remeasurement of the previously held stake and INR 38 crore stamp duty related to the merger.

• Operating cost actions identified INR 100+ crore of annualised initiatives, generating INR 70+ crore EBITDA impact in FY21.

Outlook and guidance

• FY22 priorities include improving occupancy, ARPOB and equipment utilisation, strengthening case and channel mix, and expanding clinical capabilities.

• Brownfield plans target 2,000+ potential beds across the network; initial phases at Max Smart Saket and Nanavati Mumbai are planned for FY25 commissioning.

• Max Lab and Max @ Home are targeted for scale-up, alongside digital health development, asset-light expansion and opportunistic acquisitions.

• The second COVID-19 wave was expected to persist through Q1 FY22; normalization was anticipated thereafter, with preparedness for a possible further wave.