Hi. You have only mentioned pointers about the senior living vertical of Max India. But there are more verticals which I am particularly interested in, like care at home (nursing provided at patient’s home) and care homes (wards near major hospitals for post operation care).
Let me share an anecdote regarding 24 hour nursing requirements at a patient’s home. The family which needed nursing services at their home had contacted some agency. This agency acts as a middle-man between nurses and people who need their services at home. The family was paying the agency 22k/month for 2 nurses who worked in 12hr shifts each. Now the agency pays 8k/month to these nurses and keeping the remaining money with themselves. After few months the 2 nurses discussed with the family and made an agreement that they will be leaving the agency and start working dedicatedly for them and in return they get paid 11k each.
Now since these agencies don’t provide any other healthcare services, so it’s very easy (and a common practice) for the nurses to make such deals with consumers. But in case of Max India, they provide all the below mentioned services apart from nursing at home.
o Home critical care
o Physiotherapy
o Pathology
o Diagnostics
o X-Ray & ECG
Since they are providing a complete ecosystem in care at home unlike the local agencies, it shows that the consumers for this service will be relatively sticky to the business.
Finally details are appearing on the Greater Kailash fire incident. No loop holes in the fire system of Antara. The fire broke out “accidentally due to negligence” by one of the residents in lighting up a candle or incense stick inside a room. Candles were apparently lit due to New Year’s Eve.
Sad incident, hopefully Antara / Max will learn and adapt.
@InvestorUK They are coming up with 3 new real estate projects. Will be based on Developement Model (DM). Do we know the exact revenue recognition policy which they use for DM?
This is important to understand the real estate side of business. Assisted care is pretty much clear from your previous points.
I apologize if this is a really silly question… Holding companies usually have shares of multiple companies right? From my understanding Max India is the holding company of just Antara? So what is the advantage /Disadvantage of this setup as against just listing Antara?
Its similar to - Reliance industries holding Jio, Reliance Retails etc. Imagine the unlisted subsidiaries grows and get listed then the shareholders on Max india/Reliance will get shares of listed companies in future.
Thanks…But my question was that in this case Max India holds just one compnay i.e Antara right? So what is the advantage of having a holding company with just one subsidiary rather than listing the subsidiary itself?
There is decent progress in terms of margins. From the concall, the mgmt mentioned that they are looking to expand into Bangalore and Chennai and many developers are interested. Need to see how this scales.
Still, the shareholder equity is reducing at about 15% CAGR. From 720Cr in 2020, it is now 540 Cr in 2023.
Also, when I was digging through cashflows, I saw this entry “Payment to shareholders on reduction of Equity Share Capital”. Not sure if they did buyback of shares…
They have already opened one care home in Bangalore. Final due diligence going in for a 800+ apartment residency.
Chennai, Pune – they are still scouting for land for senior living residency project.
My take on this company is:
They will break ground in Gurgaon, Bangalore and Noida phase 2 by end of this financial year or early next year. Followed by 3 more residencies in next two years – Pune Chennai and Chandigarh.
Company can stay loss making till 2028 as company is small and rapid expansion on care/memory homes will mean more loss making units (at least till first year of operation)
2030 onwards it seems to have good future (obviously need to keep track, and mostly things will fall in place unless they do any blunder on capital allocation). Existing care homes can easily take care of the new car home setup.
Beyond 2035 when senior residencies people start ageing all these resident will become implicit customers to the care home, care at home facilities and medical devices that company owns. One must understand that in addition to the normal business all residents will be captive customers of other facilities given by company.
So, not sure if any quick money can be made here. But future seems very bright.
My views are biased. Invested 7% of portfolio and will keep adding until major setback to the industry / company.
I dont think they have any Care home in Bangalore. They are looking for Senior Living in Bangalore, may go in for Care Home in South. Currently, NCR focussed company
There are many competitors but Max India claims that they are the only integrated player present across all segments. They are trying to create an ecosystem for seniors. If they achieve that, they will get lot of business by referrals and also cross selling, this reducing customer acquisition costs.
But I think they have a really long long way to go. They are primarily present NCR, Max Estates (I think group company) is focussed also on NCR. Moving to a different cities like Bangalore, Pune or Chennai will be difficult. But still much lesser Capex than hospital business.
Stock seems to have run up. Theme is good, will add more as performance.
Does anyone know why the depriciation is so low around 232cr on fixed assets of 7k cr (3.3%) ? Apollo has around 7+% depriciation rate on fixed assets.
As per the twitter handle of Antara senior care, It seems like they have started Care at Home & Medcare product services at Bangalore. Not sure if this was the trigger for recent price movement.
D: Invested/Biased.
