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Beat on estimates

* In 3QFY25, sales grew 12.8% YoY to INR9.4b (vs our est: INR8.8).

* EBITDA margin contracted 90bp on a YoY basis to 25.6%, primarily due to a higher share of RM costs (+150bp YoY), offset by a lower share of employee expense (-40bps YoY) and a reduced share of other expenses (-20bp YoY).

* Medanta reported EBITDA growth of 8.9% YoY to INR2.4b (vs our est: INR2.2b).

* PAT grew 18.4% YoY to INR1.5b. (vs our est: INR1.3b) owing to marginally lower interest and tax burden.

* Revenue/EBITDA/PAT in 9MFY25 grew 13%/7%/11% to INR27.6b/INR6.7b/INR3.9b

Key highlights

* Mature hospitals revenue (69% of total revenue) grew 10.1% YoY to INR6.5b. EBITDA was INR1.6b during the quarter, while margins contracted 30bp YoY to 25%.

* Developing hospitals revenue (31% of total revenue) grew 9.5% YoY to INR3b. EBITDA was INR1b during the quarter, with margin contraction of 150bp YoY to 33.8%.

* Medanta’s Board has approved the signing of a lease agreement to operate and manage a newly built 110-bedded hospital in Ranchi.

*The company added 34 beds in 3QFY25 to a total bed capacity of 3,042 beds.

* In 3QFY25, ARPOB grew 1.2% YoY to INR61.3K due to a combination of tariff hikes in matured facilities and changes in the case mix across the group.

* IPD/OPD volumes both increased 13.2%/8.7% YoY during the quarter.

* Occupancy levels stood at 63.6% (vs. 64% in 3QFY24 and 64.3% in 2QFY25).

* ALOS stood at 3.23 days (vs. 3.3/3.2 days in 3QFY24/2QFY25).

* OPD Pharmacy revenue increased 21.4% YoY to INR290m.

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