Anand Rathi Initiates Coverage on Global Health with a Target Price of Rs 1400

Global Health (Medanta) Surpasses Estimates with Impressive Q4FY26 Performance

Global Health, operating under the Medanta brand, has reported a significant surge in revenue, EBITDA, and Profit After Tax (PAT) for the fourth quarter of fiscal year 2026. The company's revenue, EBITDA, and PAT witnessed a year-over-year (y/y) increase of 25.9%, 25.9%, and 25.9%, respectively, surpassing our estimates by 9.12%.

Notably, the company's Average Revenue Per Occupied Bed (ARPOB) rose by 5% y/y to Rs66,687. Despite stable overall occupancy levels at 61%, which remained consistent with Q4FY25 and Q3FY26, occupancy rates at the company's new units in Lucknow, Patna, and Noida declined to 44% compared to 62% in Q3FY26. This decline can be attributed to the recent commencement of the Noida unit in November 2025, which has approximately 100 ICU beds and 14 operating theaters. Additionally, the margin of the company's existing units (excluding Noida) expanded by 220 basis points (bps) y/y to 32.4% during the quarter.

The company has made significant investments in expanding its bed capacity, adding 623 beds in fiscal year 2026. This includes 382 beds in Noida, 131 beds in Patna, and 110 beds in Ranchi, taking the total bed capacity to 3,665. Looking ahead, we expect the company's revenue, EBITDA, and PAT to achieve a compound annual growth rate (CAGR) of 15%, 24%, and 18%, respectively, over the period of fiscal years 2026-28.

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Outlook and Recommendation

Based on the company's impressive performance, we are maintaining our EBITDA estimate for fiscal years 2027 and 2028. Consequently, we are reiterating our BUY rating on the stock with a revised target price of Rs1,400, valuing it at 26x fiscal year 2028 Enterprise Value to EBITDA (EV/EBITDA).