Park Medi World Shares in Focus After Emkay Reiterates ‘Buy’, Raises Target Price to Rs 375 On Strong Q1 Performance

Operationally, average revenue per occupied bed (ARPOB) grew 12 percent year-on-year, aided by revised CGHS reimbursement rates, while inpatient volumes increased 16 percent and outpatient volumes rose 17 percent. Although occupancy declined to 55.6 percent due to significant capacity additions, EBITDA margins improved to 26.5 percent, exceeding Emkay’s expectations despite the drag from newly commissioned hospitals.

The brokerage also noted a meaningful improvement in the company’s case mix, with the CONGO mix rising by 520 basis points year-on-year, which is expected to support higher realizations going forward. Management believes the full impact of CGHS rate revisions will be reflected over the remaining quarters of FY27, further supporting revenue growth.

Looking ahead, Park Medi World plans to add around 2,130 beds across FY27 and FY28, backed by a capital expenditure plan of approximately Rs 7.67 billion. Management has guided for 24 percent revenue growth, 19 percent EBITDA growth, and 39 percent PAT growth in FY27, driven by capacity expansion, higher patient volumes, and improved realizations.

Factoring in the better-than-expected quarterly performance and the Zirakpur acquisition, Emkay has raised its EBITDA estimates for FY28 and FY29 by around 4 percent each. The brokerage expects Park Medi World to deliver a 25 percent revenue CAGR between FY26 and FY29, supported by aggressive bed additions, an improving payer mix, and a net cash balance sheet.

At the current market price of Rs 283, Emkay’s revised target price of Rs 375 implies a potential upside of around 32.5 percent, while maintaining its positive long-term outlook on the stock.