Buy Narayana Hrudayalaya, target price Rs 855: ICICI Direct

ICICI Direct has buy call on Narayana Hrudayalaya with a target price of Rs 855. The current market price of Narayana Hrudayalaya is Rs 712.75.

Narayana Hrudayalaya, incorporated in the year 2000, is a Mid Cap company (having a market cap of Rs 14593.41 Crore) operating in Hospitals & Allied Services sector.

Narayana Hrudayalaya key Products/Revenue Segments include Income from Medical and Healthcare Services, Medical Equipment and Other Operating Revenue for the year ending 31-Mar-2022.

Financials
For the quarter ended 30-09-2022, the company has reported a Consolidated Total Income of Rs 1172.80 Crore, up 12.61 % from last quarter Total Income of Rs 1041.43 Crore and up 23.14 % from last year same quarter Total Income of Rs 952.41 Crore. Company has reported net profit after tax of Rs 168.85 Crore in latest quarter.

The company’s top management includes Dr.Devi Prasad Shetty, Dr.Emmanuel Rupert, Mr.Viren Prasad Shetty, Dr.Kiran Mazumdar Shaw, Mr.Dinesh Krishnaswamy, Mr.Muthuraman Balasubramanian, Mr.Arun Seth, Mr.Subramanya Bangalore Nagappa, Ms.Terri Smith Bresenham. Company has Deloitte Haskins & Sells LLP as its auditors. As on 30-06-2022, the company has a total of 20 Crore shares outstanding.

Investment Rationale
Revenues are likely to be up 1.1% QoQ to Rs 1,155 crore due to expected drop in elective surgeries. EBITDA is expected to decline 13.5% QoQ to Rs 211 crore with margins coming in at 18.3%, down 309 bps. Net profit is expected to decline 17% QoQ to Rs 140 crore.

Promoter/FII Holdings
Promoters held 63.85 per cent stake in the company as of 30-Jun-2022, while FIIs owned 14.16 per cent, DIIs 13.71 per cent.