Over priced in the context of no new exciting news no fundamental problem local residing near Coimbatore
1 Like
| Name | Mar Cap Rs.Cr. | P/E | EV / EBITDA | CMP / BV | ROCE % |
|---|---|---|---|---|---|
| Apollo Hospitals | 1,10,095 | 60.6 | 30.9 | 12.1 | 16.6 |
| Max Healthcare | 98,497 | 67.5 | 43.9 | 9.8 | 14.9 |
| Fortis Health. | 67,293 | 66.8 | 33.9 | 7.1 | 12.0 |
| Narayana Hrudaya | 36,800 | 44.6 | 24.8 | 9.1 | 20.8 |
| Aster DM Health. | 35,199 | 97.7 | 38.2 | 7.8 | 10.7 |
| Global Health | 29,008 | 51.2 | 28.6 | 7.8 | 19.7 |
| Krishna Institu. | 27,149 | 92.5 | 37.1 | 12.0 | 15.0 |
| Dr Agarwal’s Hea | 14,277 | 112.0 | 25.7 | 7.4 | 10.0 |
| Rainbow Child. | 12,670 | 49.2 | 23.7 | 8.3 | 18.7 |
| Park Medi World | 9,592 | 45.3 | 24.3 | 7.9 | 20.4 |
| Health.Global | 8,494 | 312.2 | 21.4 | 9.3 | 8.6 |
| Jupiter Life Lin | 8,414 | 43.5 | 23.6 | 5.8 | 18.0 |
| Yatharth Hospit. | 7,174 | 42.9 | 23.8 | 4.2 | 14.0 |
| Kovai Medical | 6,004 | 25.5 | 13.4 | 5.1 | 23.3 |
| Indrapr.Medical | 3,788 | 20.7 | 11.5 | 5.8 | 39.1 |
| Artemis Medicare | 3,630 | 36.5 | 17.4 | 4.1 | 14.9 |
| Dr Agarwal’s Eye | 2,314 | 33.1 | 17.9 | 7.4 | 17.5 |
| Shalby | 1,711 | 212.3 | 14.1 | 1.7 | 6.1 |
| KMC Speciality | 1,469 | 40.1 | 18.7 | 8.1 | 17.4 |
| GPT Healthcare | 1,123 | 27.7 | 13.9 | 4.4 | 27.2 |
| Median of Top 10 | 32,103 | 63.7 | 29.8 | 8.1 | 15.8 |
| Median of Top 15 | 14,277 | 51.2 | 24.8 | 7.8 | 16.6 |
| Median of Top 20 | 9,043 | 47.2 | 23.7 | 7.6 | 17.0 |
| Kovai medical | 6,004 | 25.5 | 13.4 | 5.1 | 23.3 |
KMCH currently trades at a 45–60% discount compared to the median P/E and EV/EBITDA multiples of the top 10–20 industry peers. Despite the lower valuation, the company boasts a 23% ROCE, significantly outperforming the industry median of 15–17%. On an absolute basis, the stock is available at 25x P/E and 13x EV/EBITDA, providing a comfortable entry point relative to its growth profile, especially considering its from the secular growth sector. Even under a hypothetical (and unlikely) scenario where the industry grows EBITDA by 30% and KMCH remains flat, the stock would still trade at a discount on a forward-multiple basis.
I expect company to show growth of 12–15% over 2-3 years driven by recently added beds and the commencement of PG medical courses. Beyond that planned addition of 1,000+ beds, represents a massive ~50% expansion in bed count.
Beyond organic earnings growth, the stock offers an upside through “multiple expansion.” Market could likely to re-rate the stock if KMCH delivers growth exceeding 15% or once the new bed capacity is nearing live.
Overall, combination of a high margin of safety, superior return metrics, and a clear expansion roadmap creates a favorable risk/reward ratio.
6 Likes
Consistent Q4 Results by the company. I had a chance to visit Coimbatore and took some time to see Kovai. The place was literally full. I could only go to the OPD section but the amount of people coming for treatment was super high. It felt like DMart on a good weekend sale day :). The doctors seemed reputed with many having advanced degrees from abroad. Could also manage to speak to relatives of couple of patients. They said they had come from 40km distance and this is the best place for treatment in and around the area. The hospital had also put up a banner at main entrance stating Deloitte had given them an award for best financial disclosures and transparent reporting (dont remember exact detail but it was for corporate governance).
Overall, I am very impressed with what I saw.
Disclosure: invested
10 Likes
Iam from coimbatore
First of the the main facility is constrained with space and has reached is full potential may be an organic growth in hosiptal segment the education yes can give a growth above 12 percent but overall with sulur and other city they can only active may be a maximum of 1500 1600 cr in hospital segment the competitor is royal care which is making expansion in that same area so we have to wait for Chennai expansion which will take 2 to 3 yrs minimum and sulur 2 yrs
Only option is increase average bed revenue which is not possible in coimbatore because for every specialized thing we have massive hospital for ortho ganga for gastro gem fir eye Arvind for oncology gknm
It is low float stock which can see sudden Spike because of volumes in nse but eventually it has trade at its Historical valuation of 11 to 12 ev till any meaning full chennai contribution comes
May be 5000 cr market cap looks attractive only if chennai comes alive otherwise looks like the low float fomo is playing out
Discl holding from much lower level
4 Likes
Very good writeup on KMCH. Read related as well
6 Likes
Kovai’s numbers look decent — topline up 15%, PAT up 21%. And that’s with Education dragging: revenue and EBIT both down ~₹5 cr there, so ex-that, growth would’ve been a tad better.
The FY26 AR shows no real bed addition, so all of this is coming from ARPOB, ALOS and patient mix — not volume. Education booking is lumpy anyway, better to see it annually.
On capacity: ~100 beds should come up in the space freed by shifting the nursing college out. Last year they spent ₹120 cr on the new OPD block and neurosciences centre, plus ₹47 cr on advanced oncology and diagnostics. Chennai is still silent, but construction on the January-2026 announced hospitals to start from this quarter.
Post-results, EV/EBITDA has adjusted from 16x to 13.2x — cheapest in the industry for a hospital this size with these efficiency metrics.
Disclosure: Invested
8 Likes
AGM-Chairman-Speech-2026.pdf (249.8 KB)
Attaching the Chairman’s speech from today’s morning AGM. For those who attended, please do share notes and discussion points.
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Does anyone know what problems the Chennai project is encountering with the government and environmental authorities?
Case pending in supreme court due to environmental clearance issue
management said they will double eduction input in 5 years and cut of unprofitable sectors in eduction
Investors asked for AGM in english
Invested and biased
Localite
4 Likes
Did you attended the AGM ?
if yes, pl share more insights
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At current market cap and valuation , it is okay to invest for new investors ?
Kindly Suggest
Taking second opinion to avoid Investing at ATH and try to do mistakes
Valuation of any asset is very subjective. You should make a framework for yourself for valuing a company. As you gain new knowledge in valuation, you should keep updating your framework.
3 Likes