Equity L/S Analyst | Forensic Accounting | India, Yellowstone Equity

Ankit Agrawal, CFA

Equity L/S Analyst | Forensic Accounting | India

Creating Wealth through Alpha and Compounding

Yellowstone Equity

Providing unbiased and independent research on Indian equities to global institutions and individual investors


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Note that Ankit Agrawal (Proprietor of Yellowstone Equity) is a SEBI registered Research Analyst (Registration No.: INH000007216). Registration granted by SEBI and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors. Investment in securities market are subject to market risks. Read all the related documents carefully before investing.

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Compliance/Grievance Officer:
Name: Ankit Agrawal
Email: services@yellowstoneequity.com
Mobile: +91-7575817289
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Equity Bottom-Up

HealthCare Global Enterprises / Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/healthcare-global-enterprises-limited" target="_blank" data-smartkarma-citation="entities:23983:1" rel="noopener">HealthCare Global Enterprises ("HCG")</a> reported a strong Q3FY25 despite Q3 being a seasonally weak quarter. Revenue growth was strong across both the established centers and the emerging centers.</li>
<li>Revenue from established centers grew 20% YoY while that from emerging centers grew 25% YoY in Q3FY25. Within emerging centers, Kolkata led the growth with 40% YoY rise in revenues.</li>
<li>HCG saw promoter change in Feb 2025. KKR announced acquisition of 54% stake from CVC who owns around 60%+. Dr. BS Ajaikumar, the founder promoter, will continue to own 10%+.</li>
</ul>



HealthCare Global Enterprises ("HCG") reported a strong Q3FY25 despite Q3 being a seasonally weak quarter. Revenue growth was strong across both the established centers and the emerging centers.
Revenue from established centers grew 20% YoY while that from emerging centers grew 25% YoY in Q3FY25. Within emerging centers, Kolkata led the growth with 40% YoY rise in revenues.
HCG saw promoter change in Feb 2025. KKR announced acquisition of 54% stake from CVC who owns around 60%+. Dr. BS Ajaikumar, the founder promoter, will continue to own 10%+.


HCG: Strong Q3FY25 and Promoter Change Update

Market & Forensics Analyst, Beat the Street

Nimish Maheshwari

Market & Forensics Analyst

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Event-Driven

HealthCare Global Enterprises / Event-Driven

<ul>
<li>KKR has signed definitive agreements to acquire up to 54% of HCG from CVC Asia V, positioning itself as the largest shareholder and assuming sole operational control.</li>
<li>This will trigger an open offer to buy an additional 26% stake at a price of INR 504.41 per share. </li>
<li>Now, HCG will be seen as a transformed healthcare leader with a robust growth trajectory, driven by global expertise and strategic restructuring for long-term value creation.</li>
</ul>


KKR has signed definitive agreements to acquire up to 54% of HCG from CVC Asia V, positioning itself as the largest shareholder and assuming sole operational control.
This will trigger an open offer to buy an additional 26% stake at a price of INR 504.41 per share. 
Now, HCG will be seen as a transformed healthcare leader with a robust growth trajectory, driven by global expertise and strategic restructuring for long-term value creation.


Event Driven: KKR Acquired Controlling Stake in HealthCare Global

<ul>
<li>As HCG's scale is growing and as its emerging centers are maturing, profitability is improving. Adjusted EBITDA crossed INR 100cr mark for the first time ever.</li>
<li>EBITDA grew by 21% YoY in Q2FY25 with EBITDA margin improving to 18.8% vs 17.8% YoY. Q2FY25 revenue also grew healthy at 14% YoY to reach INR 550cr+.</li>
<li>HCG also announced acquisition of a cancer hospital in Vizag that is margin accretive. Including this acquisition, EBITDA margin is 19% and proforma revenue growth is 20% YoY.</li>
</ul>


As HCG's scale is growing and as its emerging centers are maturing, profitability is improving. Adjusted EBITDA crossed INR 100cr mark for the first time ever.
EBITDA grew by 21% YoY in Q2FY25 with EBITDA margin improving to 18.8% vs 17.8% YoY. Q2FY25 revenue also grew healthy at 14% YoY to reach INR 550cr+.
HCG also announced acquisition of a cancer hospital in Vizag that is margin accretive. Including this acquisition, EBITDA margin is 19% and proforma revenue growth is 20% YoY.


Healthcare Global (HCG): Strong Q2FY25 Led by Operating Leverage

<ul>
<li>HCG reported a decent Q1FY25 with revenue growth of 16.7% YoY, adjusted for a discontinued center in Bangalore. Growth was robust across both established and emerging centers.</li>
<li>Emerging centers (Kolkata, Borivali and South Mumbai) grew strong at 33% YoY while established centers also grew healthy at 14% YoY. All emerging centers, but South Mumbai center, are profitable.</li>
<li>We estimate that HCG could post a PAT of around INR 280cr+ by FY27. An investment in HCG at the current level has potential to provide an upside of 85%+.  </li>
</ul>


HCG reported a decent Q1FY25 with revenue growth of 16.7% YoY, adjusted for a discontinued center in Bangalore. Growth was robust across both established and emerging centers.
Emerging centers (Kolkata, Borivali and South Mumbai) grew strong at 33% YoY while established centers also grew healthy at 14% YoY. All emerging centers, but South Mumbai center, are profitable.
We estimate that HCG could post a PAT of around INR 280cr+ by FY27. An investment in HCG at the current level has potential to provide an upside of 85%+.  


HCG: Executing Well With Prudent Expansion

External broker reports(aggregated public sources), Axis Direct

Axis Direct

External broker reports(aggregated public sources)

Axis Direct is the flagship brand under Axis Securities Limited, a subsidiary of Axis Bank in India. 

Content available is external broker reports authored by a third party outside the Smartkarma network and has been aggregated by an online aggregator through publicly available sources and is displayed by Smartkarma in this format for user's convenience and general informational purposes only. Content does not constitute investment or financial advice and Smartkarma makes no representation or warranty regarding its accuracy or contents. Original third party author retains all copyright and other proprietary rights in the content. Access or use of third party links not controlled by Smartkarma are at the user's own risk.

<ul><li>The oncology industry is projected to grow at 13-14% CAGR over FY24-30E, primarily due to insufficient early-stage diagnoses in India.</li><li>It is anticipated that Healthcare Global Enterprises (HCG) could surpass this industry growth by 200-300bps.</li><li>Over the next three years, HCG's Average Revenue Per Occupied Bed (ARPOB) is expected to grow at 5% CAGR, while occupancies may experience an improvement of 300bps within the same timeframe.</li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

The oncology industry is projected to grow at 13-14% CAGR over FY24-30E, primarily due to insufficient early-stage diagnoses in India.It is anticipated that Healthcare Global Enterprises (HCG) could surpass this industry growth by 200-300bps.Over the next three years, HCG's Average Revenue Per Occupied Bed (ARPOB) is expected to grow at 5% CAGR, while occupancies may experience an improvement of 300bps within the same timeframe.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Healthcare Global Enterprises Ltd - Improving ARPOB Led By Operational Efficiency

India

HealthCare Global Enterprises Limited provides medical and surgical hospital services. The Hospital offers cancer care, chemotherapy, cyberknife surgery, surgical, radiation, and medical oncology services. HealthCare Global Enterprises operates worldwide.

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HealthCare Global Enterprises (HCG IN)

HCG: Strong Q3FY25 and Promoter Change Update

HCG is growing from strength to strength led by prudent expansion and focus on best clinical outcomes. At current valuation, an investment in HCG...

Ankit Agrawal, CFA

Event Driven: KKR Acquired Controlling Stake in HealthCare Global

KKR acquires majority stake in HCG, triggering open offer for additional shares at INR 504.41 per share. HCG poised for growth as healthcare...

Nimish Maheshwari

Healthcare Global (HCG): Strong Q2FY25 Led by Operating Leverage

HCG is scaling up well led by operating leverage and growing vintage of its emerging centers. It is also making strategic acquisitions to further...

Ankit Agrawal, CFA

HCG: Executing Well With Prudent Expansion

HCG continues to execute well with scaling up of its emerging centers, brownfield expansion of its core centers and prudent inorganic acquisitions....

Ankit Agrawal, CFA

Healthcare Global Enterprises Ltd - Improving ARPOB Led By Operational Efficiency

The oncology industry is projected to grow at 13-14% CAGR over FY24-30E, primarily due to insufficient early-stage diagnoses in India.

Axis Direct

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HCG: Strong Q3FY25 and Promoter Change Update

HCG is growing from strength to strength led by prudent expansion and focus on best clinical outcomes. At current valuation, an investment in HCG...

Ankit Agrawal, CFA

Event Driven: KKR Acquired Controlling Stake in HealthCare Global

​KKR acquires majority stake in HCG, triggering open offer for additional shares at INR 504.41 per share. HCG poised for growth as healthcare...

Nimish Maheshwari

Healthcare Global (HCG): Strong Q2FY25 Led by Operating Leverage

HCG is scaling up well led by operating leverage and growing vintage of its emerging centers. It is also making strategic acquisitions to further...

Ankit Agrawal, CFA

HCG: Executing Well With Prudent Expansion

HCG continues to execute well with scaling up of its emerging centers, brownfield expansion of its core centers and prudent inorganic acquisitions....

Ankit Agrawal, CFA

Healthcare Global Enterprises Ltd - Improving ARPOB Led By Operational Efficiency

The oncology industry is projected to grow at 13-14% CAGR over FY24-30E, primarily due to insufficient early-stage diagnoses in India.

Axis Direct

KKR acquires majority stake in HCG, triggering open offer for additional shares at INR 504.41 per share. HCG poised for growth as healthcare...