MAXHEALTH - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 05 Nov 25, 7:43 am

Fundamental Rating: 3.8

Max Healthcare shows solid operational performance and low debt, but its valuation is stretched and return metrics are moderate. Long-term potential exists, especially with expansion plans, but accumulation should be cautious and timed around dips.

📊 Financial Overview

• Revenue Growth: Q4 FY25 revenue rose 21% YoY, driven by higher patient volumes

  MoneyControl

• Profitability: PAT at ₹166 Cr, slightly down from ₹177 Cr QoQ; EPS at ₹7.33
• Margins: ROCE at 12.5%, ROE at 9.45% — moderate efficiency
• Debt Profile: Debt-to-equity ratio of 0.07 — very low leverage
• Dividend Yield: 0.13% — minimal income return

📈 Valuation Metrics

• P/E Ratio: 146 — significantly above industry average of 59.6
• P/B Ratio: ~13.4 — premium valuation relative to book value ₹85.3
• PEG Ratio: 4.62 — indicates overvaluation relative to growth
• Intrinsic Value: Estimated around ₹1,000–₹1,050 based on normalized earnings

🏢 Business Model & Competitive Edge

• Core Operations: One of India’s largest private hospital chains with strong presence in Delhi NCR, Mumbai, and Punjab
• Moat: High occupancy rates (~70%), strong brand, and institutional patient mix

  Value Research

  +1

• Growth Drivers: Expansion of 1,500 beds in FY26 via brownfield projects at Saket, Nanavati, and Mohali

  MoneyControl

📌 Entry Zone Recommendation

• Suggested Entry: ₹1,050–₹1,100 — near intrinsic value and below DMA50
• Technical Indicators: RSI at 51.7 (neutral), MACD positive — mild bullish momentum

📈 Long-Term Holding Guidance

• Hold for long-term if accumulated near support; monitor margin trends and occupancy rates
• Expansion plans and institutional mix support future growth, but valuation needs to cool

✅ Positive

• Strong revenue growth and patient volumes
• Low debt and stable EBITDA margins (~28%)

  Value Research

• Institutional and international patient mix expanding

  AxisDirect

⚠️ Limitation

• High P/E and PEG ratios
• Moderate ROE and ROCE
• FII holding declined by 2.96%

📰 Company Negative News

• Q3 FY25 earnings impacted by one-off YEIDA regulatory fee

  Value Research

🌟 Company Positive News

• Q4 FY25 net profit up 21% YoY; expansion of 1,500 beds planned

  MoneyControl

• Revenue mix shifting toward higher-value institutional segments

  AxisDirect

🏭 Industry

• Healthcare industry P/E at 59.6 — Max Healthcare trades at a premium
• Sector driven by urbanization, insurance penetration, and medical tourism

🧾 Conclusion

• Max Healthcare is a premium healthcare stock with strong operational metrics and expansion potential
• Accumulate cautiously on dips; long-term outlook supported by strategic growth and brand strength

Sources

Value Research

Value Research,

AxisDirect

Axis Direct,

MoneyControl

Moneycontrol