Apollo Hospitals Enterprises Ltd, has posted a net profit of Rs 307 m for FY01 as against Rs 279 m in FY00. Operating margins have improved by 190 basis points to 19.2%. Though net profit has grown by 10.2%, EPS has slipped from Rs 17.5 to 7.8 due to increase in paid up capital of the company.
Operating Profit (EBDIT)
Operating Profit Margin (%)
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In 99-00, Apollo merged three entites of Apollo group viz, Deccan Hospital, Indian Hospitals and Omsindori Hospitals under its banner. Subsequently the company also did a private placement of shares to institutions and promoters and hence the increase in share capital. Consequent to the merger, Apollo Hospitals now has a capacity of 2600 beds, the largest private sector healthcare infrastructure in South Asia.
At the current market price of Rs 92, the stock is trading at 12 x FY01 earnings. Apollo Hospitals has ambitious plans to increase the bed capacity further to 6000 beds by means of managing properties, creating line of pharmacies and clinics within the next few years. As the size of the projects, which the group is eyeing are relatively big, any slippage in terms of financial management could spell disaster for the company.
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