More Stories

Informist, Wednesday, Jul. 29, 2026

By Ritwika Dutta 

MUMBAI - Rainbow Children's Medicare Ltd. is expected to report a strong growth in net profit on year for the June quarter, but the growth is likely to be slower due to higher fixed costs of recent capacity additions. The growth in revenue will be driven by performance of mature hospitals and the ramp-up of new hospitals, according to brokerages tracking the company.

Rainbow Medicare is expected to report a consolidated net profit of nearly INR 659 million for the June quarter, up 23% on year but down 16% on quarter, according to the average of estimates from six brokerages. The highest estimate for the consolidated net profit is INR 990 million from Axis Securities Ltd. and the lowest is INR 532 million from Anand Rathi Share and Stock Brokers Ltd.

The company's consolidated net sales are expected to be INR 4.5 billion for the June quarter, up 28% on year but down 1.4% on quarter. The highest estimate for the consolidated net sales in the June quarter is INR 5.6 billion from Axis Securities and the lowest is INR 4.1 billion from Systematix Shares and Stocks (India) Ltd. The company had reported net sales of INR 3.5 billion a year ago and INR 4.5 billion a quarter ago.

The company's profit margin is expected to fall because of losses at new units, though underlying growth is expected to remain robust. Elevated employee cost will also affect profit growth. Overall, hospital profitability trends remain healthy despite ongoing investments in capacity expansion, according to brokerages.  

The revenue growth will be supported by capacity expansion over the last 12 months and expectations of an increase in average revenue per occupied bed, brokerages said. Occupied bed days' growth of 26% on year will boost the company's revenues despite this being partially offset by a 3% on-year decline in average revenue per occupied bed, Emkay Global said.

The company runs multi-specialty paediatric and obstetrics and gynaecology hospitals. It runs around 20 hospitals and five outpatient clinics, spread across seven Indian cities, with a capacity of 2,035 beds.

The company's expected earnings before interest, tax, depreciation, and amortisation in June quarter are INR 1.3 billion, up 34% on year but down almost 4% on quarter, according to the estimates. The company's EBITDA margin is likely to contract by 75 basis points on year, as it will absorb initial gestation losses from new units, Emkay Global said. The company will detail its June quarter earnings Thursday.

Wednesday the company's shares closed at INR 1,496.70 on the National Stock Exchange, down almost 2% from Tuesday. The stock is up almost 11% since the company reported its March quarter earnings on May 25.

All seven brokerage reports on the company available with Informist have a 'buy' recommendation on the stock with an average target price of INR 1,602 per shares. This signifies an upside of 7% from the current market price.

The following are the June quarter earnings estimates for Rainbow Children's Medicare Ltd. from six brokerages in descending order of the estimates of net profit in INR million:

End

Edited by Pankaj Aher

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd. by NSE Data & Analytics Ltd., a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt. Ltd.