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Informist, Thursday, May 21, 2026

By Ruchira Kagita

MUMBAI - Earnings of Fortis Healthcare Ltd. for the quarter ended March are expected to be largely healthy. The company's diagnostics business is likely to post stronger growth and revenue from its hospitals operations is seen stable during the quarter. Footfall from international patients is expected to take a hit on the back of restricted travel due to the war in West Asia.
 

The hospital chain's consolidated net profit for the three months ended March is seen flat on year at INR 2.38 billion and its revenue for the period is estimate to rise 15% to INR 23.10 billion, according to the average of estimates from seven brokerages. Elara Securities (India) Pvt. Ltd. sees the company's net profit rising the most by 14% on year to INR 2.70 billion. On other hand, JM Financial Institutional Securities Pvt. Ltd. had the lowest profit estimate at INR 1.99 billion, indicating a fall of over 16%. The profit figures are adjusted setting aside exceptional items.

From the earnings estimates available with Informist, Elara Securities had the highest revenue estimate of INR 23.50 billion for the March quarter, and Motilal Oswal Financial Services Ltd.'s was the lowest at INR 22.26 billion.

The March quarter is typically a good one for hospitals given the rise in patient care due to winter-related maladies. However, some impact due the war in West Asia may be likely in this reporting quarter due to a decline in international footfalls. However, the company expects its international patient inflows to recover, brokerage Citigroup Inc. said in report after interacting with the management early April.

Brokerages also pencilled in higher doctor costs to weigh on the company's margin growth this time around. According to Informist, Fortis Healthcare's earnings before interest, taxes, depreciation, and amortisation may come in at INR 5.20 billion in the March quarter.

The margins of most hospital companies may contract owing to higher overhead costs stemming from newly added hospitals, ICICI Securities Ltd. said in a research report. Fortis Healthcare had acquired the 125-bedded People Tree Hospital in Bengaluru for INR 4.30 billion.

Fortis Healthcare's Agilus Diagnostics business is likely to see margins around 24% in the reporting quarter, Nuvama Wealth Management Ltd. noted in its report. The brokerage forecast the company's EBITDA margin for the hospitals division at 23%. ICICI Securities, meanwhile, sees the company's hospital margin falling to 21.2%.

The company's brownfield strategy with bed additions is seen driving a quicker EBITDA break-even, Motilal Oswal Financial Services said in its initiation report on the company earlier in April. Cost overruns, underperformance in expansions and acquisitions, shortage of skilled medical personnel, fluctuations in patient volumes could be some key growth risks for the company, the brokerage noted.

The management of Fortis Healthcare said it targets an addition of over 400 beds in 2026-27 (Apr-Mar), mainly supported by expansion at the Fortis Memorial Research Institute in Gurugram. Insights into the progress of this expansion will be important to note. The extent of improvement in Gleneagles Hospitals in Chennai and Hyderabad will also be a focus point for investors. The top executives at the hospital network were bullish on their growth trajectory for FY27. Further, the company had guided for the average revenue per occupied bed growing 4-5% over the next two years, supported majorly by its oncology business and international patient businesses. Whether the company maintains this outlook will be key to watch, given the emergence of the West Asia crisis.

The private hospital network's consolidated net profit is seen around 21% higher on an annual basis between INR 10.16 billion and INR 10.48 billion, as per two broking firms while its revenue for the period may fall to INR 89.90 billion-INR 90.75 billion.

Thursday, shares of Fortis Healthcare were down 0.3% at INR 971 on the National Stock Exchange. The company had reported its earnings for the quarter ended December on Feb. 13, and since then, the stock gained almost 6%. Fortis Healthcare will report its March quarter earnings Friday.

Of the nine research reports on the company available with Informist, six have a "buy" call on the stock at an average target price of INR 1,107. Two broking firms have a "hold" call and one has a "sell" stance.

The following are the Jan-Mar estimates for Fortis Healthcare from seven brokerages in ascending order of net profit in INR billion:

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Edited by Akul Nishant Akhoury

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