Multibagger Stock: Narayana Hrudayalaya shares are one of the multibagger stocks that Dalal Street has delivered in the post-Covid stock market rebound. Even though this multibagger healthcare stock has remained negative to negative over the past one year, it has delivered returns of nearly 250 percent to its long-term investors over the past four years. In fact, the stock witnessed heavy buying by the bulls after entering 2019. In this period, this healthcare stock has gained from approx. from 200 715 each level.
However, Prabhudas Lilladher has ‘Buy’ tag on this healthcare stock, despite the negative trend since last one year. Brokerage believes the stock could go up 965 each level in long term. Narayan Hrudayalaya Share price on NSE today is around 715 per share, which means the brokerage is expecting over 250 per cent returns from this healthcare stock.
Highlighting the fundamentals that have fueled the share price rally of Narayana Hrudayalaya, the brokerage says, “Narayana Hrudayalaya reported EX IND AS EBIDTA. 2.4 billion, higher than our estimate (Rs. 2.1 billion). Adjusted for St Lucia’s Rs 13 million EBITDA loss in Q3, EBIDTA was up 3% QoQ and 50% YoY. Overall, margins improved by 430 bps YoY and 120 bps QoQ to 22.6%. India business continues to post strong EBITDA of Rs 1.6 billion; 6% QoQ and 58% YoY. Cayman reported EBIDTA of USD 11.5mn vs USD 12.5mn in Q2 and USD 10.1mn in Q3FY22. OPM stood at 41.2%, down 270 bps QoQ.”
The brokerage further said, “Revenue grew 18% YoY (down 1% QoQ) to Rs11.3bn. ARPOB for India business grew 4% QoQ to 35,068/day, aided by improved payer mix.” 10% YoY for India. Cayman revenue grew 13% YoY to $28.2mn (down 3% QoQ). Discharge was down 17% while OP volumes for Cayman were up 13% YoY; ARPOB was up 10% YoY. PAT was reported at Rs1.5bn (up 58% YoY).Net debt declined from Rs.535mn to Rs2.1bn.
On stock market investors suggestion regarding Narayana Hrudayalaya shares, Prabhudas Lilladher said, “We expect to maintain the growth momentum. The company plans to continue with its aggressive capex plan for the next 2-3 years.” is guided by an annual capex of Rs 10 billion. in FY23E and FY24E. More significantly the capex spend will be towards its core and high performing regions such as Bangalore, Kolkata and Cayman. Rs 965/share (earlier Rs Maintain ‘Buy’ rating with a revised TP of 920 / share). 20x FY25E EV/EBITDA for India business and 12x EV/EBITDA for Cayman Hospitals.”
The brokerage further said that at current market prices, Narayana Hrudayalaya stock is trading at attractive valuations of 13x EV/EBITDA (adj to IND AS) and 20x P/E on FY25E. Rapid growth in the new Cayman unit will be a key.
Disclaimer: The views and recommendations given above are of individual analysts or broking companies and not of Mint. We advise investors to do due diligence with certified experts before making any investment decision.
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