Healthcare major Fortis Healthcare delivered a strong Q4FY26 performance, prompting brokerage firm Prabhudas Lilladher to reiterate its ‘BUY’ recommendation with a revised target price of ₹1,120 per share.
Key Financial Highlights – Q4FY26
- EBITDA rose 22% YoY to ₹532 crore, beating street expectations
- Hospital business EBITDA increased 20% YoY
- Hospital operating margins improved to 22%
- Diagnostics EBITDA surged 35% YoY with margins at 24.9%
The strong quarterly performance was driven by improved occupancy, better case mix, operational efficiencies, and continued momentum in diagnostics.
Growth Triggers Driving Brokerage Optimism
Aggressive Bed Expansion
Fortis plans to add nearly 1,800 beds over the next four years, strengthening its long-term growth visibility.
Key additions expected in FY27 include:
- 400–500 new operational beds
- Expansion at FMRI Gurugram
- Capacity additions across existing facilities
Acquisition Synergies & Margin Expansion
The brokerage highlighted positive integration momentum from:
- People Tree Hospital acquisition
- Shrimann Hospital acquisition
- O&M agreement with Gleneagles hospitals
These assets are expected to improve scale, network strength, and profitability over the medium term.
Capex & Financial Outlook
- Annual capex guidance stands at ~₹900 crore
- Majority of investments focused on expansion and growth initiatives
- PL Research expects:
- 21% EBITDA CAGR over FY26–FY28E
- Revenue growth exceeding 15% in FY27
Brokerage View
Prabhudas Lilladher believes Fortis remains well-positioned to benefit from:
- Rising healthcare demand
- Premium hospital expansion
- Higher diagnostics contribution
- Operating leverage benefits
The brokerage values the hospital business at 30x EV/EBITDA on FY28 estimates and maintains a constructive outlook on the stock.
