Buy Artemis Medicare Services Ltd for the Target Rs.350 by Choice Institutional Equities Ltd
Large expansion pipeline to drive long-term growth:
ARTMSL is targeting capacity expansion to ~2,000 beds over the next 3–5 years. The 300-bed Raipur facility is anticipated to break even within 12–15 months as occupancy improves towards 25–30%. International patients, contributing ~30% of revenue across 150+ countries, provide an additional growth avenue. Proposed oncology drug margin cap could impact EBITDA margin by 50–80 bps.
Revenue growth in line, EBITDA margin beats estimate
* Revenue came in at INR 3.1 Bn (vs. CIE estimate: INR 3.1 Bn), up 13.2% YoY and 8.3% QoQ.
* EBITDA came in at INR 0.5 Bn (vs. CIE estimate: INR 0.5 Bn), up by 8.3% YoY and down by 2.9% QoQ. EBITDA margin at 17.6% (vs. CIE estimate of 16.7%), impacted by 80 bps YoY and 202 bps QoQ.
* PAT came in at INR 0.3 Bn (vs. CIE estimate: INR 0.3 Bn), up 3.5% YoY and de-grew by 0.9% QoQ, with a PAT margin of 10.0% (vs. 10.9% in Q2FY26)
Large expansion pipeline to drive growth:
ARTMSL is targeting a significant expansion in its operational capacity to ~2,000 beds over the next 3–5 years, supported by its ongoing and planned projects. The Gurugram campus expansion, including an additional +200 beds through Tower 4, is anticipated to increase capacity from ~700 to over 900 beds. Further, the proposed 650-bed South Delhi facility at Lajpat Nagar is anticipated to commence operations in Q4FY29. The company is also evaluating large-format hospitals of 300–500 beds, primarily across Delhi NCR, Central and Eastern India, providing a strong long-term growth visibility.
International patient business to support growth:
The company serves patients from over 150 countries, with international patients contributing ~30% of consolidated revenue. Its presence across markets spanning the Middle East, Africa, CIS, Canada and other regions provides opportunities to strengthen referral relationships and develop new source markets. The management remains focussed on expanding its international reach while maintaining clinical quality and patient experience. The continued development of specialised clinical capabilities across oncology, cardiac sciences and organ transplantation is forecast to strengthen its positioning
Raipur facility poised for operational breakeven:
Artemis Shanti Hospital in Raipur represents a key growth opportunity, with the gradual improvement in occupancy and operating performance. The 300-bed multi-specialty facility commenced operations in July 2026 and has already reported quarterly revenue of INR 5.3 Cr. Occupancy stands at ~10% at present, while revenue per occupied bed has reached INR 32,000. The management expects occupancy to improve towards 25–30%, over the next few quarters, with operational breakeven targeted within 12–15 months
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SEBI Registration no.: INZ 000160131
