Apollo Hospitals: Business overview - Views on News from Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks


Login Failure
(Please do not use this option on a public machine)
  Sign Up | Forgot Password?  

Apollo Hospitals: Business overview

Jan 8, 2004

Operating in one of the sunrise industries of the Indian economy, i.e. healthcare, Apollo Hospitals is the pioneer of the concept of organised healthcare. The group operates a chain of hospitals with total bed strength of nearly 6,000 beds (owned and managed). Apollo Hospitals group now has the third largest number of hospital beds in the world (managed as well as owned). The company also operates a large pharmacy chain spread mainly in south India.Apollo Hospitals is well positioned to capitalize on the potential of this sector. As mentioned above, the company is a pioneer in its field and it has build up its brand over the years and spread its reach across the country. The company has also entered into the pharmaceutical retailing business, realizing its obvious synergies with the core hospital business.

Apollo Hospitals is aggressively moving towards the managed hospitals model, where the company provides management and technical support to other hospitals for a fee. Setting up new hospitals is very capital intensive and hence the shift to the managed hospital model, where the operating margins are much better. The company has expanded operations in to pharma retailing also, however, operating margins of this business, being relatively lower, has taken a toll on overall margins.

FY03 was no different for the company. As like previous years, margins have fallen (18% compared to 19% in FY02) due to higher contribution to the topline from the low margin pharma retailing business. However, what was noticeable about the company's performance in FY03 was the fact that both its pharma retailing (25%) and hospitals businesses (15%) continued to grow steadily. Net profits consequently improved by 11% in FY03. In FY04, so far (first half), the company has reported a 10% growth in its topline while its bottomline has grown by a better 26% mainly due to reduced interest costs as well as better control over expenses.

At Rs 179 the stock is trading at a P/E of 19.3x its annualised 1HFY04 earnings. Apollo Hospitals is in a unique position to take advantage of the expected boom in the healthcare sector waiting to happen in the country. With the expected growth of the health insurance services market in the country, the healthcare sector is expected to benefit immensely. Also, due to the cheaper costs of healthcare services in the country, the group is in a good position to take advantage of health tourism business coming to India.

Equitymaster requests your view! Post a comment on "Apollo Hospitals: Business overview". Click here!


More Views on News

APOLLO HOSPITALS Announces Quarterly Results (3QFY20); Net Profit Up 9.0% (Quarterly Result Update)

Feb 19, 2020 | Updated on Feb 19, 2020

For the quarter ended December 2019, APOLLO HOSPITALS has posted a net profit of Rs 948 m (up 9.0% YoY). Sales on the other hand came in at Rs 25 bn (up 16.6% YoY). Read on for a complete analysis of APOLLO HOSPITALS's quarterly results.

APOLLO HOSPITALS 2018-19 Annual Report Analysis (Annual Result Update)

Oct 18, 2019 | Updated on Oct 18, 2019

Here's an analysis of the annual report of APOLLO HOSPITALS for 2018-19. It includes a full income statement, balance sheet and cash flow analysis of APOLLO HOSPITALS. Also includes updates on the valuation of APOLLO HOSPITALS.

APOLLO HOSPITALS Announces Quarterly Results (1QFY20); Net Profit Up 31.8% (Quarterly Result Update)

Aug 16, 2019 | Updated on Aug 16, 2019

For the quarter ended June 2019, APOLLO HOSPITALS has posted a net profit of Rs 793 m (up 31.8% YoY). Sales on the other hand came in at Rs 22 bn (up 16.7% YoY). Read on for a complete analysis of APOLLO HOSPITALS's quarterly results.

MSTC IPO: Should You Bet on This State-Run E-Commerce Player? (IPO)

Mar 13, 2019

Should you subscribe to the IPO of MSPC Limited?

More Views on News

Most Popular

Why We Picked This Small-cap Stock for Our Hidden Treasure Subscribers (Profit Hunter)

Sep 17, 2020

This leading household brand will profit big time in a post covid world.

My Top Stock to Buy in this Market Selloff (Profit Hunter)

Sep 22, 2020

The recent correction offers a great opportunity to buy this high conviction smallcap stock.

What Do the Charts Say About Buying Smallcaps Now? (Fast Profits Daily)

Sep 18, 2020

Everyone seems to be excited about buying smallcaps now...but is it the right thing to do? What do the charts tell us? Find out in this video...

Can the Nifty Fall to 10,200? (Fast Profits Daily)

Sep 24, 2020

The Nifty has reached an important support level today. If it breaks then we could see further downside.


Covid-19 Proof
Multibagger Stocks

Covid19 Proof Multibaggers
Get this special report, authored by Equitymaster's top analysts now!
We will never sell or rent your email id.
Please read our Terms


Sep 25, 2020 (Close)


  • Track your investment in APOLLO HOSPITALS with Equitymaster's Portfolio Tracker. Set live price alerts, get research alerts and more. Get access now...
  • Add To MyStocks