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MOSL: MOrning India (26/August/22): 1. Apollo Hospitals | Annual Report Update (Mobilizing resources for another healthy take off); 2. EcoScope; 3. Textiles

MOrning India (26/August/22): 1. Apollo Hospitals | Annual Report Update (Mobilizing resources for another healthy take off); 2. EcoScope; 3. Textiles

Apollo Hospitals | Annual Report Update: Mobilizing resources for another healthy take off

• Our analysis indicates that APHS achieved the highest return ratio in FY22 historically, from an all-time low return ratio in FY21. The company exceeded pre-Covid profitability in FY22, driven by improved performance across segments - healthcare services, pharmacy and Apollo Health and Lifestyle (AHLL) and aided by Covid to some extent.
• Interestingly, its operating parameters in healthcare services (ARPOB/ occupancy) and pharmacy (number of stores/average revenue per store) segments are on an uptrend with scope for further improvement. Front-loading of investments to Apollo 24/7, though, would moderate margins/return ratios in FY23.
• However, the exponential rise in GMV aided by back-end infrastructure, positions APHS favorably in this segment. Even the capex for bed addition would be funded from internal accruals. We remain positive on APHS because of: a) its superior positioning in the pharmacy segment through offline/online presence supported by strong back-end infrastructure, and b) enhanced outlook for healthcare services/AHLL segment. We value APHS on an SOTP basis (22x EV/EBITDA for healthcare services, 25x EV/EBITDA for front-end pharmacy, 15x EV/EBITDA for retained pharmacy, 30x for AHLL and 4x EV/sales for Apollo 24/7) to arrive at our TP of INR5,110.

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  Listed private non-finance companies log 41% sales growth in Q1FY23: RBI

  The Reserve Bank of India (RBI) on Thursday said the first quarter of FY23 saw listed private non-financial companies log 41 per cent sales growth. The RBI came out with its report, drawing the data from the abridged quarterly financial results of 2,749 listed private non-financial companies. "Sales growth (yoy) of listed private non-financial companies surged to 41.0 per cent in Q1:2022-23 from 22.3 per cent in the previous quarter," it said. According to the RBI, manufacturing logged sales growth of 41.6 per cent driven by broad based demand expansion across industries aided by both volume and price effects.