Concall AI

Dr. Agarwal's Health Care Limited — Q4 FY26 earnings call

Call held 21 May 2026

Management summary

Dr. Agarwal's Healthcare Limited reported a strong Q4 and full year FY26, achieving record revenues over INR 2,000 crores and significant PAT growth. The company continued its aggressive greenfield expansion, adding 19 new facilities in Q4 and planning 60 more for FY27. While mature facilities showed robust same-store growth, new facilities incurred initial operating losses, and refractive surgery volumes saw some softness. The merger process is progressing, with an expected conclusion by Q3 FY27.

Highlights

Full year revenue from operations grew 21.6% YoY to INR 2,080 crores.
Full year Ind AS EBITDA grew 22.2% YoY to INR 614 crores, with margin at 28.9%.
Full year PAT grew 52.4% YoY to INR 168 crores, with margin at 7.9%.
Q4 revenue from operations grew 22.6% YoY to INR 564 crores.
Q4 Ind AS EBITDA grew 18.9% YoY to INR 174 crores, with margin at 30.2%.
Total doctor strength crossed 1,000 across the network.
Same-store sales growth for mature facilities (pre-FY22) was a strong 14%.

Concerns

Q4 other expenses increased due to one-time merger process costs (approx. INR 80 lakhs) and corporate office rental expenses (approx. INR 1 crore for the year).
New facilities opened in FY26 incurred an operating loss (burn) of approximately INR 30 crores.
Refractive surgery volumes experienced a 'softness' or 'slight slowness' compared to cataract growth, though high-end procedures grew 19% YoY.

Key financials

2 periods

Q4 FY26

Total Income
₹577 Cr
YoY +21.2%
Revenue from Operations
₹564 Cr
YoY +22.6%
Ind AS EBITDA
₹174 Cr
YoY +18.9%
EBITDA Margin
30.2%
PAT
₹50 Cr
YoY +17.4%
PAT Margin
8.7%

FY26

Total Income
₹2,125 Cr
YoY +20.9%
Revenue from Operations
₹2,080 Cr
YoY +21.6%
Ind AS EBITDA
₹614 Cr
YoY +22.2%
EBITDA Margin
28.9%
PAT
₹168 Cr
YoY +52.4%
PAT Margin
7.9%

What they filed

Q1 FY27: revenue up 26.8%, net profit up 70.0% against the same quarter last year.

₹ Cr · quarterly

Line item	Q2 FY25	Q3 FY25	Q4 FY25	Q1 FY26	Q2 FY26	Q3 FY26	Q4 FY26	Q1 FY27
Revenue	255	268	281	302	309 +21%	335 +25%	348 +24%	383 +27%
Expenses	198	203	208	235	240	255	256	287
EBITDA	58	65	73	67	69 +19%	80 +23%	92 +26%	96 +43%
Margin	23%	24%	26%	22%	22%	24%	26%	25%
Other income	5	10	24	12	6	6	1	3
Interest	23	23	21	19	17	18	19	19
Depreciation	38	39	42	44	48	48	56	58
Profit before tax	1	12	34	16	10 +900%	20 +67%	18 −47%	22 +38%
Tax rate	746%	37%	22%	35%	51%	31%	42%	26%
Net profit	-4	8	27	10	5 +225%	14 +75%	11 −59%	17 +70%
EPS	0.12	0.25	0.84	0.32	0.15	0.44	0.33	0.53

How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

Revenue by Service Type (FY26)
67% Surgical Services12% Diagnosis, Consultations, Non-Surgical21% Optical Products & Pharmacy
Revenue by Region (FY26)
₹1,273 Cr Southern Region Revenue61% Southern Region Share₹341 Cr West Region Revenue16% West Region Share₹191 Cr North Region Revenue9% North Region Share
Payor Mix (FY26)
62.4% Cash (Overall)28.5% Insurance & TPA (Overall)9% Government Schemes (Overall)72% Cash (Domestic)22% Insurance & TPA (Domestic)6% Government Schemes (Domestic)

Capital allocation

high confidence

Capex ₹380 Cr
- New facilities (40 surgical, 20 clinics)
- New CMS facility
So for this year, we are looking at an overall outflow of about INR 380 crores to INR 400 crores, which includes all our capex for this year, including our new CMS facility. We're looking at adding about 40 surgical facilities and 20 clinics, and this would envisage a total CapEx spend of about INR 380 crores to INR 400 crores. And this includes the CapEx spend for our new CMS facility.
Debt Debt disclosed
- Repayment Systematic repayment of loans from IPO proceeds (INR 128 crores in Q4 FY25 and INR 67 crores in H1 FY26). ₹195 Cr
On the finance cost front, the improvement has been driven by two key factors: a total of INR195 crores in loans have been systematically repaid from IPO proceeds, INR128 crores in Q4 FY '25 and INR67 crores in H1 FY '26. Concurrently, interest on deferred consideration arising from past acquisitions have also been declining as outstanding payments are made, providing further reduction in our overall finance cost.
M&A Dr. Agarwal's Eye Hospital Limited Merger · Pending regulatory

For the proposed merger of Dr. Agarwal's Healthcare Limited and Dr. Agarwal's Eye Hospital Limited, we have continued to make steady progress on the regulatory process. During February 2026, we received stock exchange observation letters with no adverse objections following which we filed the NCLT application. In May 2026, the Honorable NCLT Chennai bench allowed the joint first motion application and directed the convening of meetings of equity shareholders, secured and unsecured creditors of both companies on July 2, 2026. We will continue to update the exchanges as we progress through the remaining steps, including shareholder approvals and the final NCLT sanction.

Guidance & targets

Growth

Overall growth pace Growth · FY27 · High confidence similar pace to prior year

So looking ahead, we expect growth to sustain at a similar pace compared to the previous year.

— Adil Agarwal

Profitability

EBITDA Margins Profitability · FY27 · High confidence stable

On the margin front, we expect our EBITDA margins to stay stable even as we continue to invest aggressively in greenfield expansion, reflecting the underlying operating leverage in our model.

— Adil Agarwal
Losses from new facilities Profitability · FY27 onwards · Medium confidence reducing

I'm quite sure that at a per branch level, our loss per branch would start reducing from FY '27 onwards, while our growth in revenue will continue very strongly and the number of branches that we are planning to open also, as you would have seen from the presentation, is quite strong for FY '27 in Gurgaon and Delhi.

— Rahul Agarwal

Capex

Total CapEx spend Capex · FY27 · High confidence INR 380-400 crores

So for this year, we are looking at an overall outflow of about INR 380 crores to INR 400 crores, which includes all our capex for this year, including our new CMS facility.

— Adil Agarwal

Capacity

New facilities commissioned Capacity · FY27 · High confidence 60

We are planning to commission 60 new facilities across the year, 30 each in the first and second half of the year. Out of these 60 facilities, 40 will be surgical centers and 20 will be clinics.

— Adil Agarwal

Capital Allocation

Acquisition-related payments Capital Allocation · FY27 · High confidence INR 60-65 crores

Tushar, it will be approximately to the tune of about between INR 60 crores to INR 65 crores, Tushar.

— Yashwanth Venkat
Acquisition-related payments Capital Allocation · FY28-30 · High confidence INR 60 crores

Then FY '28 it will be -- FY '28, '29 and '30, put together INR 60 crores.

— Yashwanth Venkat

Merger

Merger conclusion Merger · Q3 FY27 · Medium confidence Q3 FY27

All of this to conclude all of this, we are expecting another five months or so, five to six months. By end of this year, Q3 of this year, we'll expect to conclude it.

— Aashna Dharia

Operating Expenses

Rental expenses for AEHL Operating Expenses · FY27 · High confidence INR 32 crores

On the rental expenses, the overall number will be to the tune of about close to INR 32 crores, sir.

— Yashwanth Venkat

New Facility Launch

New Chennai CMS facility launch New Facility Launch · October 1, 2026 · Medium confidence October 1, 2026

So we should be we are targeting a launch of -- hopefully, by October 1, 2026, is when we should have the new project up and running.

— Adil Agarwal

What to watch in Q1 FY27

New Chennai CMS facility launch

Q3 FY27

Current Targeting October 1, 2026

Target Successful launch and initial operational performance

Why it matters

This is a major new facility expected to significantly increase volumes and realization, impacting overall revenue and profitability.

So we should be we are targeting a launch of -- hopefully, by October 1, 2026, is when we should have the new project up and running.

Risks & concerns

Initial operating losses from new greenfield facilities
medium

New facilities opened in FY26 incurred an operating loss of approximately INR 30 crores, with significant losses from Delhi branches. Management expects these losses to reduce from FY27 onwards.

Management acknowledged
Softness in refractive surgery volumes
medium

Refractive surgery growth has not been commensurate with cataract growth, showing 'slight slowness'. Management is focusing on high-end procedures and seeking insurance support to boost volumes.

Both acknowledged
Bottlenecks in real estate acquisition and regulatory compliance for new facilities
medium

Challenges in securing suitable real estate at the right cost and navigating local state/clinical board compliance and licensing requirements can cause delays in expansion.

Management acknowledged
Delay in new Chennai CMS facility launch due to approval processes
low

Approvals for the new Chennai CMS facility have been delayed due to factors like elections and code of conduct, pushing the target launch to October 1, 2026. Management expects timely completion despite this.

Management acknowledged

Q&A highlights

6 direct

FY27 Capex breakdown and acquisition-related payments Direct

So for this year, we are looking at an overall outflow of about INR 380 crores to INR 400 crores, which includes all our capex for this year, including our new CMS facility. We're looking at adding about 40 surgical facilities and 20 clinics, and this would envisage a total CapEx spend of about INR 380 crores to INR 400 crores. And this includes the CapEx spend for our new CMS facility. ... Tushar, it will be approximately to the tune of about between INR 60 crores to INR 65 crores, Tushar. ... For FY '26, it was around close to INR 85 crores.

Provides clear financial targets for future capital expenditure and acquisition payments, crucial for cash flow analysis.

Asked by Tushar Manudhane

Increase in Q4 other expenses and merger timeline Direct

In Q4, the other expenses actually pertain to onetime expenses incurred towards the merger process. Also, we had we have recently moved our corporate office in December. So the other expenses are comprised of that expense rental expense as well. On the merger, it is more towards the finance opinion provider and the legal consultant and the retail outreach consultant. ... Merger expenses are onetime. The corporate office rent, it will continue. ... All of this to conclude all of this, we are expecting another five months or so, five to six months. By end of this year, Q3 of this year, we'll expect to conclude it.

Clarifies the nature of increased expenses (one-time vs. recurring) and provides a timeline for the significant merger event.

Asked by Rachna Kukreja

Value and volume growth breakdown for FY26 Direct

So overall, for the year, we've had a 22%-odd revenue growth, out of which, if I were to just look at the SSSG, that will be in the range of around 14%. In this SSSG, our volume growth is close to 7% and the value growth also is similar at 7%. Now in the volume growth, comprising of OPD growth is in the range of around 5.5% and the remaining comes from increased conversions. In the value, premiumization would be in the range of 5% and another 1.5% comes from price hike.

Detailed breakdown of revenue growth drivers (volume, value, premiumization, price hike) for same-store sales, offering insight into operational performance.

Asked by Maulik Varia

Operating losses from new facilities and their trend Direct

But what I can tell you is that last year, so FY '26, the number of branches that new greenfields that we opened, we sustained a loss of around INR30 crores in from a unit economics perspective of those branches. ... So FY '26 is where we have opened the Delhi branches. Of course, there's been significant losses in the INR 30 crores from Delhi. ... I'm quite sure that at a per branch level, our loss per branch would start reducing from FY '27 onwards.

Highlights the initial profitability drag from new greenfield expansions and management's expectation for improvement, crucial for future margin projections.

Asked by Nikhil Upadhyay

Sustainability of 14% growth in mature facilities Direct

I feel broadly, it has been sustainable for us for the last three to four years. So directionally, yes, I can't go to the last percentage, but I think directionally, OPD growth has been growing. So we don't see an issue there. Premiumization has been on track. And one of the things, for example, right now, we are at INR 45,000 INR 41,000 average cataract per eye. And we do see opportunities with our new technologies with higher penetration with more disposable income for the premiumization to continue for a while. So price hike, 1.5% has been -- 1% to 1.5% is average that we do end up getting. So in this range, we do feel comfortable from a broad few years perspective.

Reassures investors about the durability of growth drivers (OPD, premiumization, price hikes) in the core business, indicating sustained performance.

Asked by Harith Ahamed

Softness in refractive surgery volumes and future outlook Partial

So I would say that between cataract and refractive, cataract has grown faster. And while refractive has also grown, but the growth has not been commensurate to the cataract growth. So yes, that is one definitely one part. We've seen slight slowness. However, if you see our high-end procedures, which is the Lenticular Procedures, they have grown much faster at 19%. ... From a long-term perspective, I think refractive as a market continues to remain. ... But yes, I think there's also some support that we are seeking in the insurance side of it, and we are talking to the insurers.

Acknowledges a specific area of underperformance (refractive volumes) and outlines strategies to address it, including leveraging insurance.

Asked by Harith Ahamed

Bottlenecks in accelerating new facility additions Direct

Now we can go and put up 70, 80 centers, but the biggest bottleneck for us, obviously, will be getting the right real estate because one is you want to ensure that you get the right real estate at the right cost is where you want to be cognizant of some of the costs. Second, you have to get the real estate with the right kind of compliance because we are governed by each local state, local clinical board. So we have to ensure that we get all the license in line with some of the local authorities. And getting that compliance in most of the cities is a bit of a challenge. That's why we see sometimes a bit of a delay.

Identifies key operational challenges (real estate, compliance) that limit faster expansion, providing context for the planned 60 new facilities in FY27.

Asked by Punit Pujara

Contribution of the new large Chennai hospital (CMS facility) Partial

And Varun, on the new CMS facility, we will be commissioning that facility. Hopefully, if we get all the approvals and everything depends on us getting those approvals by October 1, 2026. And we're hoping to see a sizable improvement in both revenue and profitability once we move on to the new facilities. But as with any new movement whichever happens, we will have to give it some time 12 to 18 months to see where this business will stabilize there. It's difficult to predict that right now. But we're hoping to see a significant increase in both volumes and realization once we move into the new facility.

Provides an expected launch timeline and qualitative outlook for a major new facility, indicating its potential impact on future revenue and profitability.

Asked by Varun Hiremath

3 min read 6 chapters

Detailed narrative

Record Financial Performance and Milestones

Dr. Agarwal's Healthcare Limited achieved a landmark year in FY26, crossing INR 2,000 crores in revenue for the first time, with total income reaching INR 2,125 crores, a 20.9% YoY increase. Revenue from operations grew 21.6% to INR 2,080 crores. The company delivered a robust Ind AS EBITDA of INR 614 crores, marking a 22.2% YoY growth and improving margins by 31 basis points to 28.9%. Profit After Tax (PAT) saw a significant increase of 52.4% YoY to INR 168 crores, with PAT margin expanding by 164 basis points to 7.9% for the year. The company also reached a total doctor strength of over 1,000 across its network.

Aggressive Network Expansion and Footprint Growth

The company continued its aggressive greenfield expansion strategy, commissioning 19 new facilities in Q4 FY26, including 7 surgical centers and 12 primary facilities. For the full year FY26, the company launched one new facility every week, adding its footprint across 26 new cities. Since FY23, Dr. Agarwal's has added 148 new greenfield facilities, representing a 5.7x growth in annual additions. The total network now stands at 269 facilities in India and 19 in Africa, spread across 14 states and five union territories covering 155 cities. For FY27, the company plans to commission 60 new facilities, comprising 40 surgical centers and 20 clinics, with a significant focus on the North and West regions.

Clinical Excellence and Procedure Volumes

In FY26, the company served over 30 lakh patients and performed over 3.23 lakh surgeries. High-end cataract surgeries accounted for 26.3% of the 62,800 total cataract procedures, with robotic Femto Cataracts growing robustly by 87% YoY, crossing 5,900 procedures. Retinal surgeries increased by 23% from last year, reaching 12,800 procedures. Surgical services remained the main revenue driver, contributing 67% to the group's revenue. The company also performed over 1,150 corneal transplants during the year. However, refractive procedures experienced some 'softness' compared to cataract growth, though high-end Lenticular Procedures grew 19% YoY.

Operational Efficiency and Same-Store Growth

The company's sustained focus on operational efficiency and disciplined execution contributed to its strong performance. Mature facilities (opened prior to FY22) contributed INR 1,375 crores in revenue, reflecting a strong 14% same-store sales growth and accounting for 66% of group revenues. This growth was driven by approximately 7% volume growth (5.5% from OPD, rest from conversions) and 7% value growth (5% from premiumization, 1.5% from price hike). Management expects this growth trajectory to be sustainable. The company's new software, Neo, an AI-ready hospital management system, currently manages 20,000 patients daily and is built to scale beyond 5,000 branches and 2 million patients.

Merger Update and Capital Allocation

Progress on the proposed merger of Dr. Agarwal's Healthcare Limited and Dr. Agarwal's Eye Hospital Limited continues, with NCLT Chennai bench allowing the joint first motion application and directing shareholder meetings on July 2, 2026. The merger is expected to conclude by Q3 FY27. In terms of capital allocation, the company plans an overall CapEx outflow of INR 380-400 crores for FY27, primarily for new facilities and a new CMS facility. Acquisition-related payments are projected to be INR 60-65 crores in FY27 and INR 60 crores for FY28-30. The company has systematically repaid INR 195 crores in loans from IPO proceeds, contributing to a reduction in finance costs.

Regional Performance and Future Outlook

The Southern region remains the largest market, contributing 61% of group revenues with INR 1,273 crores, growing 22.6% YoY. The West region contributed 16% of revenues (INR 341 crores, up 19% YoY), and the North region 9% (INR 191 crores, up 20.7% YoY). The company expects growth to sustain at a similar pace in FY27, underpinned by deeper penetration, expansion into new geographies, and adoption of innovative surgical procedures. EBITDA margins are expected to remain stable despite aggressive greenfield expansion, reflecting underlying operating leverage. The company's expansion strategy in FY27 will see the North and West regions more than double their facility additions compared to FY26.

This is an AI-generated summary of a publicly available earnings call transcript.

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