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About the Company

Jupiter Lifeline Hospitals Limited (JLHL) is among the key multi-specialty tertiary and quaternary healthcare providers in the Mumbai Metropolitan Area (MMR) and western region of India with a total bed capacity of 1,194 hospital beds across three hospitals as of March 31, 2023. JLHL has been operating for over 15 years as a corporate quaternary care healthcare service provider in densely populated micro markets in the western regions of India and currently operate three hospitals under the “Jupiter” brand in Thane, Pune and Indore, with an operational bed capacity of 961 beds and 1,306 doctors including specialists, physicians and surgeons as of March 31, 2023. JLHL is expanding its presence in developing a multi-specialty hospital in Dombivli, Maharashtra, which is designed to accommodate over 500 beds and has commenced construction in April 2023.

Structural drivers remain buoyant

The health expenditure grew strong at 8.6% CAGR from FY12 to FY22 and the structural demand existing in the country is expected to grow and the potential opportunity of better healthcare in India is growing based on affordability and healthcare insurance penetration moving the value chain. JLHL have equipped their hospitals with over 30 specialties including key specialties of organ transplant, oncology, orthopaedics, cardiology, paediatrics, neurology, and neurosurgery as well as certain specialised quaternary services and precision-based treatments such as brachytherapy, radiotherapy, robotic knee replacement and robotic neuro serving the healthcare needs of patients, right from diagnostics to surgery and rehabilitation

Strategic footprint, increasing health awareness and medical tourism key advantages

The two key states Maharashtra and Gujarat stand out in terms of health insurance penetration among the West India states. Penetration of health insurance coverage in the country stood at 38% in FY22, while the average for West India states of Maharashtra, Goa, Gujarat and Madhya Pradesh was approximately 78% in FY22. With schemes such as the PMJAY, health insurance penetration in these states is expected to grow further in the coming years, thus providing a boost to private hospitals. The healthcare costs in developed countries are relatively higher in comparison to India. Some of the factors which make India an attractive destination for medical tourism are presence of technologically advanced hospitals with specialized doctors and facilities like the e-medical visa

Financials in Brief

JLHL has grown from a single hospital in Thane in 2007 to 3 hospitals with an operational bed capacity of 961 beds as of FY23. Their inpatient volumes were 42,956 and outpatient volumes were 730,981 in 2023 with an average occupancy rate of beds for their Thane and Pune hospital at 72% and 67.5% for FY23. The revenue from operations has significantly increased from Rs486.16 crore in FY21 to Rs892.54 crore in FY23. The inpatient and outpatient revenue is diversified across hospitals with Thane, Pune and Indore hospitals accounting for 54.18%, 34.03% and 11.79%, respectively, of their revenue from operations in FY23.

Our View

JLHL is present in the strong MMR region where population is consistently increasing and remains a focused micro market with MMR has 33.0 beds per 10,000 people, which is higher than the state average of Maharashtra (20 beds per 10,000 people). It has an estimated population of 20.96 million. JLHL intends to improve occupancy rates and equipment utilization at hospitals by continuing to maintain and recruit new medical professionals of high caliber in specified fields and focus on clinical excellence. The issue is priced at a P/BV of 11.41 based on its NAV of Rs. 64.39 as of March 31, 2023, post IPO it will be a debt free company and growth in healthcare segment, good patient volumes, cost efficiency, strong financials, and expansion to new areas will drive the company’s performance going forward hence, we recommend to “SUBSCRIBE” the issue from the long term perspective.

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