Analyst Concall
Max Healthcare to add 1,500 beds in FY26, to expand presence
This story was originally published at 15:27 IST on 21 May 2025
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--Max Health: Bed occupancy for Jan-Mar was at 75%
--Max Health: Jan-Mar avg revenue per bed INR 77,100 vs INR 76,800 a yr ago
--Max Health: Will continue to seek acquisition opportunities
--Max Health: International patients accounted for 9% of the revenue Jan-Mar
--Max Health: Geopolitical issues impacting flow of international patients
--Max Health: Plan to add 1,500 new beds in FY26
--Max Health: Interest cost rose Jan-Mar due to borrowings for acquisitions
By P. Madhu Kumar and Narayana Krishna
MUMBAI/HYDERABAD – Max Healthcare Institute Ltd. plans to add nearly 1,500 beds in the financial year 2025-26 (Apr-Mar) as part of its expansion plan, the company's management said in a post-earnings conference call with analysts. The plan is aimed at significantly increasing its presence in the healthcare market, the management said.
The new beds will be added across locations and includes 268 beds to be commissioned within 90 days at Max Nanavati in Mumbai and 500 beds to be added at its Gurugram facility by the end of FY26. Expansion at its facility in Mohali, Punjab, is also underway. Max Healthcare's total bed capacity as on Mar. 31 was 5,100 beds.
The company is focussing on brownfield projects, which involves expanding existing facilities, said Managing Director Abhay Soi. This approach allows Max Healthcare to leverage its existing infrastructure and expertise, ensuring efficient utilisation of resources, and also helps improve margins, he said.
In terms of financial performance, Max Healthcare reported an average revenue of INR 77,100 per occupied bed in Jan-Mar, up from INR 76,800 a year ago. This metric indicates the company's ability to generate revenue from its existing bed capacity. Max Healthcare's bed occupancy rate in Jan-Mar was 75% and the occupied bed days grew by 30% year on year and 2% on quarter. The management said the expansion plans are expected to drive growth and increase Max Healthcare's market share, and that the company is well-positioned to capitalise on the growing demand.
The company said geopolitical issues are impacting the flow of international patients, particularly from Bangladesh and Pakistan. Despite these challenges, the company's revenue from international patients grew 28% year-on-year in Jan-Mar. International patients accounted for 9% of Max Healthcare's revenue in the Jan-Mar quarter at INR 2.02 billion.
The company reported a 27% on-year jump in its consolidated net profit for the March quarter to INR 3.19 billion but missed analysts' expectations of INR 4.21 billion. The company's revenue for the quarter surged over 34% on year to INR 3.76 billion. At 1509 IST, the company's shares were at INR 1,143.10 on the National Stock Exchange, down almost 2% from Tuesday.
The management said the company will continue to look for acquisition opportunities, but the target asset has to be capable of delivering 20-25% return on capital employed within five years of the acquisition. The company had acquired the 200-bed Alexis Hospital in Nagpur, Maharashtra, in February 2024, and before that it had acquired the 550-bed Sahara Hospital in Lucknow in December 2023.
The company's interest cost rose over 175% to INR 1.65 billion during the March quarter due to the borrowing undertaken for acquisitions. This increase in interest cost is a direct result of Max Healthcare's strategy to expand through strategic acquisitions, the company's management said. End
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Ashish Shirke
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