Mehabe score: 2 G Factor: 3 Piotski Score: 7 The stock has a rating OBSERVE & HOLD. The mehabe team score is reflective of its fundamental and technical merits. A rating above 8 is considered good buy. The stock has a G-Factor of 3 and Piotski score of 7.
Description
Apollo Hospitals was established in 1983 by Dr. Prathap C Reddy, renowned architect of modern healthcare in India. As the nation’s first corporate hospital, Apollo Hospitals is acclaimed for pioneering the private healthcare revolution in the country.
Main Points
Healthcare Business (53% of revenues)
Company’s healthcare business has a capacity of 10,261 beds in 71 facilities located in India and overseas. Of the 71 facilities, 45 are self owned hospitals, 10 are cradles, 11 are day care/short surgical stay centres and 5 are hospitals under management.Site:APOLLOHOSP
Market Cap:
Rs 46,655 cr
Price:
3245.0
Trading pe:
231.0x
Book-value:
218/share
Div yield:
0.18 %
Earning yield:
1.05%
Face-value:
5.00/share
52week high:
3435.00
52week low:
1311.00
Technical Analysis
Stock trades at 3245.0, above its 50dma 3200.74. It also trades above its 200dma 2698.02. The stock remains bullish on techicals
The 52 week high is at 3435.00 and the 52week low is at 1311.00
Price Chart
P/E Chart
Sales and Margin
Strengths
– has been maintaining a healthy dividend payout of 37.66%
-‘s median sales growth is 17.72% of last 10 years
Weakness
– Stock is trading at 14.88 times its book value
– has low interest coverage ratio.
-Promoter holding has decreased over last quarter: -1.00%
– has a low return on equity of 8.16% for last 3 years.
-Promoters have pledged 27.94% of their holding.
Competition
– The industry trades at a mean P/E of 38.8x. Max Healthcare trades at the industry’s max P/E of 499.78x. APOLLOHOSP trades at a P/E of 231.0x
– Industry’s mean G-Factor is 5.0 while the mean Piotski score is 9.0. APOLLOHOSP has a G-Factor of 3 and Piotski scoreof 7.
– Average 1 month return for industry is 7.1%. The max 1- month return was given by Metropolis Healt: a return of 19.99 %
Quarterly Results
Sales for period ended Mar 2021 is Rs 2868.0 cr compared to Rs 2922.0 cr for period ended Mar 2020, a fall of 1.8%
Operating Profits reported at Rs 412.0 cr for period ended Mar 2021 vis-vis 380.0 for period ended Mar 2020 .
Operating Margins expanded 136.1 bps for period ended Mar 2021 vis-vis Mar 2020 .
The EPS for Mar 2021 was Rs 11.67 compared to Rs 9.38 for previous quarter ended Dec 2020 and Rs 15.77 for Mar 2020
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 10560.0 cr for period ended Mar 2021 vis-vis sales of Rs 11247.0 cr for the period ended Mar 2020, a fall of 6.5%. The 3 year sales cagr stood at 8.6%.
Operating margins shrank to 11.0% for period ended Mar 2021 vis-vis 14.0% for period ended Mar 2020, contraction of 300.0 bps.
Net Profit reported at Rs 150.0 cr for period ended Mar 2021 vis-vis sales of Rs 455.0 cr for the period ended Mar 2020, falling 203.3%.
Company recorded a Net Profit CAGR of 8.6% over the last 3 years
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
Sales Growth
Profit Growth Statement
Profit Growth Statement
Stock Price CAGR
Return of Equity
General Comments
– The company has improved its Return on Equity (RoE) metric. The RoE on Last Year basis was 14.0% compared to 8.0% over the last 3 Years. – The stock has given a return of 129% on a 1 Year basis vis-vis a return of 47% over the last 3 Years. – The compounded sales growth on a TTM bassis is -2% vis-vis a compounded sales growth of 16% over the last 3 Years. – The compounded profit growth on a TTM basis is -36% vis-vis a compounded profit growth of 27% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has risen for the period ended Mar 2021. The Mar 2021 fii holding stood at 54.51% vis-vis 51.7% for Dec 2020 – Public shareholding has remained largely constant. The Mar 2021 public holding stood at 6.2% vis-vis 6.4% for Dec 2020
Conclusion
– has been maintaining a healthy dividend payout of 37.66%
-‘s median sales growth is 17.72% of last 10 years – Stock is trading at 14.88 times its book value
– has low interest coverage ratio.
-Promoter holding has decreased over last quarter: -1.00%
– has a low return on equity of 8.16% for last 3 years.
-Promoters have pledged 27.94% of their holding.
Fundamentally, the stock remains weak on business fundamentals. Weak near term results have dampened and questioned business drivers. We suggest to wait for a upturn in business performance.
Technically, the stock trades above its 50 DMA 3200.74 and is trading at 3245.0 It has shown near term bullish momentum contrary to business fundamentals. We suggest to observe price action. However as investors, who like to avoid timing the markets, we suggest to avoid the stock
