Highlights of Q4FY21 result and earnings call
AHEL’s net sales declined 1.9% YoY but grew 3.9% QoQ to Rs28.9bn during the quarter.
Hospital segment revenues grew 10.2% YoY and 7.1% QoQ to Rs15.4bn with recovery in the regular business. This was also supported by improvement in ARPOB with stable occupancy of ~63%. However, COVID-19 cases have seen a sharp jump in Apr-May’21 due to the 2nd wave. This has pushed occupancy as high as 71% but the average realisation for COVID-19 patients is lower.
TN region sales grew 5.7% YoY to Rs5.6bn driven by higher ARPOB despite lower occupancy ratio due to absence of international patients. o AP & Telangana region sales grew 19.4% YoY to Rs3.1bn due to higher ARPOB on improving payor mix despite lower occupancy.
Karnataka region sales grew 6.4% YoY to Rs1.9bn with rise in regular patients and sharp jump in outpatient volumes.
Other regions sales grew 6.3% YoY to Rs2.0bn due to higher ARPOB on improving payor mix despite lower occupancy.
Significant subsidiaries/JVs/Associate revenues grew 6.1% YoY to Rs5.3bn with rise in regular patients and sharp jump in outpatient volumes.
Proton Cancer Centre, AHEL’s oncology unit, is witnessing continuous demand from domestic patients. Revenue improved 12.8% QoQ to Rs309mn. The company believes that it can achieve an EBITDA of Rs500mn and Rs1bn from this segment in FY22E and FY23E respectively.
AHLL segment saw healthy recovery with revenue growing 25.8% YoY (+6.7% QoQ) to Rs2.1bn. Apollo 24/7 witnessed strong traction and it was able to funnel more patients into AHLL, particularly the diagnostic segment. The company is targeting a revenue of Rs3bn in FY22E and Rs5bn in FY23E from the diagnostic segment.
New hospitals reported a revenue growth of 30.1% YoY (+12.4% QoQ) with an EBITDA margin of 15.1% during the quarter.
Pharmacy business revenues declined 17.7% YoY to Rs11.2bn However, adjusting for the demerger and high sales post lockdown in Mar’20, growth stood at 10-11% YoY. Company is targeting an addition of 300-350 stores in FY22 with high double digit growth supported by Apollo 24/7.
Company has vaccinated ~45% of the total private vaccinations in the country till date and expects to vaccinate an additional ~8-10mn people in the next few months. Despite price-caps, Apollo expects some margin.
Company has reorganised its segments; Apollo 24/7, backend pharmacies and pharmacy retail business into a new department called Apollo HealthCo. It will be an omni-channel healthcare platform integrating its online and offline services.
Currently, it has 10mn customers which is expected to rise to 80-100mn by FY25.
Potential revenue from this segment is ~Rs2.5bn by FY25. Company has invested ~Rs2bn and expects to invest ~Rs1-1.5bn in the near term.
Source ICICI SEC