Apollo Hospitals

Apollo Hospitals reported a strong Q3 FY26, maintaining positive momentum with double-digit top-line growth across all three business verticals: Healthcare Services, Apollo HealthCo, and AHLL. Consolidated revenue grew 17% year-on-year to INR 6,477 crore. Consolidated EBITDA saw a robust 27% year-on-year growth, reaching INR 965 crore, and consolidated PAT increased significantly by 35% year-on-year to INR 502 crore. This performance was achieved despite Q3 typically being a seasonally weak quarter.

The Healthcare Services division recorded a healthy 14% year-on-year revenue growth to INR 3,183 crore. This growth was driven by a balanced mix: 5% from volume growth, 4% from case mix, and 5% from pricing. Surgical volumes grew by 6%, supported by a focus on CONGO-T specialties, which delivered a robust 16% year-on-year revenue growth. Group-wide occupancy stood at 67%, and average revenue per patient (ARPP) increased to INR 180,917 in Q3 FY26 from INR 173,246 in Q2 FY26, reflecting increased clinical intensity.

Apollo HealthCo's revenues grew 20% year-on-year to INR 2,827 crore. Within this, the pharmacy distribution business recorded an EBITDA of INR 195 crore, a 23% year-on-year increase. AHLL delivered a strong performance with EBITDA growing 39% year-on-year to INR 48 crore, and margins improving to 10.2% from 8.8% in Q3 FY25. Cumulatively, Apollo HealthCo's EBITDA more than doubled to INR 128 crore in Q3 FY26 compared to INR 57 crore in Q3 FY25.

The digital business reported cash losses of INR 29 crore, the lowest in any quarter. However, the cash EBITDA breakeven target has been pushed out by one quarter to Q1 FY27 due to an INR 17 crore insurance revenue recognition mismatch and adjustments related to GST and the Amazon e-commerce channel, which impacted GMV by approximately INR 75 crore for Q3. Despite these challenges, the online pharmacy GMV grew by 32%, and the Apollo 24/7 platform added 2 million new users, reaching over 46 million users with a platform GMV of INR 525 crore, up 28% year-on-year.

Apollo operationalized 75 beds in its Pune facility during the quarter. The company plans to commission four new hospitals in Hyderabad, Kolkata, Bangalore, and Gurgaon, adding approximately 1,500 operating beds. Roughly half of this capacity is expected to be operationalized in FY27, with the balance in early FY28, incurring an estimated INR 150 crore in losses for the next year. The Gurugram hospital's operationalization is delayed to Q2 FY27 due to environmental issues, while Hyderabad, Calcutta, Pune (additional beds), and Sarjapur are expected to operationalize by Q1 FY27.

Progress has been made on the regulatory integration process for the composite scheme of Keimed merger and demerger of Apollo HealthCo. Competition Commission and SEBI approvals have been obtained, and NCLT hearings have commenced. This merger is strategically positioned to achieve a run rate of INR 25,000 crore in combined revenues with 7% EBITDA, reinforcing Apollo's integrated healthcare ecosystem and patient-centric strategy. Keimed has also streamlined its subsidiary network, with all 100% subsidiaries set to merge into AHLL.

Management expects to maintain hospital margins by balancing new hospital ramp-up with existing hospital performance, targeting at least 100 basis points margin expansion in the existing business next year. ARPP growth is driven by a combination of tariff increases (3%), effective price realization (5%) due to insurance contract resets, and a strategic focus on higher complexity cases and CONGO-T specialties. New hospitals are expected to achieve around 40% occupancy in the first year, with 1,300 beds projected to breakeven in two years.