(KMC)Kauvery Multi-Specialty Hospital

(Gaurav62) #1

KMC(Kauvery) Speciality Hospitals (India) Ltd., incorporated in the year 1982, is a multi-speciality Indian Hospital Chain operating in Tamilnadu. Their hospitals are located in Trichy, Karaikudi, Hosur and recently inaugurated one in Salem.All their hospitals are well equipped and have several care centers. From 40 beds KMC now turned into 1200+ bedded hospital.

KMC Speciality Hospitals (India) Ltd. key Products/Revenue Segments include Hospital Services which contributed Rs 39.85 Crore to Sales Value (72.68 % of Total Sales), Pharmaceuticals which contributed Rs 14.64 Crore to Sales Value (26.70 % of Total Sales), Others which contributed Rs .19 Crore to Sales Value (0.33 % of Total Sales), Other Operating Revenue which contributed Rs .13 Crore to Sales Value (0.23 % of Total Sales) and Scrap which contributed Rs .02 Crore to Sales Value (0.03 % of Total Sales)for the year ending 31-Mar-2017.

The company’s top management includes CA.S Chenthilkumar, Dr.S Chandrakumar, Dr.S Manivannan, Dr.T Senthilkumar, Mr.A Ganesan, Mr.A Krishnamoorthy, Mr.B Pattabhiraman, Mr.N Bala Baskar, Mr.S Aravindan, Mrs.Jayanthi Narayanaswamy.

(vchhajed) #2

Following this script for some time now, but I don’t understand the reason for its continuous fall. Any clues?

(Vicky05) #3

It has political connection in Tamil Nadu. Be cautious

(Gaurav62) #4

In my opinion it’s because of profit booking and their last quarterly results were not so good, their net profit was down by almost 50%. But I won’t deny the possibility of price manipulation by operators. However, as far as I checked I saw no or very little sign of it.

(Gaurav62) #5

I know Vick but it’s not enough to prove that there’s something cooking. I saw no signs of books manipulation. Only worrying thing I found was their contingent liabilities but they need money for expansion.All their hospitals have reviews ranging from 4.1 to 4.5 by thousands of people on google,justdial and practo and in some cities more that Apollo.

(vchhajed) #6

You talked about their past performance in terms of revenues and profits but what is your take on the valuation front? As per the business scenario, what seems to be the fair value of the stock?

(Gaurav62) #7

It’s trading at PE of 30 against industry PE of 50. It’s their expansion phase so high PE is justified. EBIDTA CAGR is 25% for 6 years ,ROE is 19.31% and ROCE is 25%. EV to EBIDTA’s fair when compaired to it’s peers like Apollo, Fortis or Wockhardt. I think traditional valuation methods won’t work here since this company is in it’s early stages. But they created brand name, have good corporate governance with qualified promoters, high OPM% compared to it’s peers and have unsaturated market. Still based my calculations it should be valued at 30-35rs against CMP of 12. It’s possible that I missed something that’s why I posted about this stock on this forum.

(Manish Vachhani) #8