Chandan Healthca — Q4 FY26 earnings call

Call held 1 Jun 2026

Management summary

Chandan Healthcare Limited reported a strong Q4 and full year FY26, with revenue growing over 20% and EBITDA expanding by 31% YoY for the full year. The company achieved significant milestones in geographical expansion, including pan-India presence and securing large PPP projects. Management outlined an aggressive expansion strategy focusing on comprehensive diagnostic centers, franchise scaling, and new specialized services like PET scans and a genome lab, while aiming to maintain EBITDA margins between 30-35% in the medium term.

Highlights

  • Strong revenue growth in Q4 FY26 (18.96% YoY) and full year FY26 (20.43% YoY).

  • Significant EBITDA growth of 31.02% YoY for FY26, with margin expansion of 164 basis points to 20.25%.

  • Robust PAT growth of 22.04% YoY for FY26, reaching INR 27.06 crores.

  • Successful geographical expansion into 13 states, with plans to add three more, and entry into premium metro markets (Mumbai, Kolkata, Raipur, Chandigarh).

  • Secured five PPP projects for 10 years with an estimated project value of INR 800 crores, including advanced MRI and CT scan systems in Punjab, Haryana, and Assam.

Concerns

  • One-time exceptional item of INR 2.92 crores due to new Labor Code implementation, impacting profitability slightly.

  • EBITDA margin for the consolidated entity (including pharmacy business) is lower than the diagnostic-only business (20.25% vs. >40%).

  • Receivables from government business can extend up to six months, leading to higher working capital requirements.

Key financials

2 periods

Q4

  • Revenue
    ₹77.41 Cr
    YoY +19%
  • EBITDA
    ₹14.25 Cr
    YoY +12.7%
  • PAT
    ₹6.92 Cr
    YoY +14.9%

FY26

  • Revenue
    ₹280.67 Cr
    YoY +20.4%
  • EBITDA
    ₹56.84 Cr
    YoY +31%
  • EBITDA Margin
    20.3%
  • PAT
    ₹27.06 Cr
    YoY +22%
  • PAT Margin
    9.6%
  • Total Test Count
    8.8 Mn
    YoY +20.7%
  • Patient Count
    2 Mn
    YoY +12.8%

What they filed

Q1 FY27: revenue up 19.1%, net profit up 27.9% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue110 55 63 68 68 −38%65 +19%76 +21%81 +19%
EBITDA20 9 10 14 14 −29%12 +33%11 +12%20 +41%
Net profit11 4 6 6 8 −29%5 +8%5 −18%8 +28%
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

  • Pathology
    71.5% Share of Revenue
  • Radiology
    28.5% Share of Revenue
  • B2C
    40% Share of Revenue29% YoY Growth
  • B2B
    30% Share of Revenue50% YoY Growth
  • B2G (Government)
    29.9% Share of Revenue
  • Referral Sales
    39.8% Share of Revenue
  • Government Sales
    31.8% Share of Revenue
  • Corporate Sales
    25.3% Share of Revenue
  • Franchise Sales
    1.6% Share of Revenue
  • Online Sales
    1.5% Share of Revenue

Capital allocation

high confidence
  • Capex ₹45 Cr Internal accruals and warrant proceeds (25% received, 75% in next one year)
    • 5 comprehensive centers ₹32.5 Cr
    • 20 labs ₹20 Cr
    Basically, for this year, we are putting 20 labs in 20 districts and five comprehensive centers because we have a limitation to have comprehensive centers everywhere because comprehensive center requires nearly INR6 crores to INR7 crore. So, for five comprehensive centers, we will put nearly INR30 crores to INR40 crore, and for 20 labs, we will put nearly INR20 crore. Means INR45 crores to INR50 crores investment we are going to do in this year by having comprehensive centers and labs. ... Internal accrual as well as we are already having a warrant for INR104 crores, already 25% we have received and rest of the 75% we will get in next one year. And that will be used for the expansion together with our internal accruals.
  • Debt Debt disclosed Cost 8.9%
    So these loans and advances are to our group company like hospital, so these are on temporary basis on demand. So whenever they require money, and we are charging interest on it also. ... 12%. 12%. Very short period. And our loans, our loans are 8.9% in Chandan Healthcare, but we are charging 12% from related party company Chandan Hospital.

Guidance & targets

Profitability

  • EBITDA Margin Profitability · Financial Year · High confidence 30%-32%
    So overall, we are targeting around 30%-32% kind of EBITDA margins on a very conservative side.

    — Amar Singh

  • EBITDA Margin Profitability · Financial Year · High confidence 32%-35%
    And we try to do at least 32%-35% EBITDA, and we are spacing our expansions in the way so that we should not come down to less than 30%.

    — Amar Singh

  • EBITDA Margin Profitability · Next two years · High confidence 30%-35%
    We can expect only around 30% or between 30% to 35%.

    — Amar Singh

  • EBITDA Margin Profitability · After two years · Medium confidence 40% plus-minus
    But after two years, we will make more balance and try to achieve the EBITDA around 40% plus-minus.

    — Amar Singh

  • Overall EBITDA Margin Profitability · Next financial year · Medium confidence Higher than last year
    It will be higher than last year, but I cannot give you the number. But it will be higher than last year and after first quarter result, you can have some guidance.

    — Amar Singh

Network Expansion

  • Operational Franchises Network Expansion · Next 24 months · High confidence 1,000
    we have set a clear target to scale up to 1,000 operational franchises over the next 24 months.

    — Amar Singh

  • New Comprehensive Centers Network Expansion · This financial year · High confidence 5
    for this financial year, we have set the target for five comprehensive centers and 20 labs.

    — Amar Singh

  • New Labs Network Expansion · This financial year · High confidence 20

    — Amar Singh

  • New Comprehensive Centers Network Expansion · Next financial year · High confidence 5
    In the same manner, in the next year also, we will have five comprehensive centers and 20 standalone labs.

    — Amar Singh

  • New Standalone Labs Network Expansion · Next financial year · High confidence 20

    — Amar Singh

Geographical Coverage

  • Uttar Pradesh & Uttarakhand Districts Covered Geographical Coverage · Within two years · High confidence All districts
    And within two years, we will cover all the districts of Uttar Pradesh, and then we will move forward to other states.

    — Amar Singh

New Services

  • PET Scans Operational New Services · This financial year (Q1) · High confidence 2
    Chandan is putting two PET scans, one at Gorakhpur and one at Kanpur, and they will be started in this financial year in the first quarter.

    — Amar Singh

  • Genome Lab Operational New Services · Within five to six months · High confidence 1
    This is the first genome lab in Uttar Pradesh. It's a genetic lab at Jankipuram, Lucknow, and it will be started in this financial year. It will take another five to six months because it is a very -- it is a highly specialized lab.

    — Amar Singh

Revenue

  • Jeena Sikho Daily Revenue Revenue · Current · High confidence INR 4.5 lakhs

    Previously INR 2.5-3 lakhs → INR 4.5 lakhs

    It has crossed INR4.5 lakhs every day. It has crossed now INR4.5 lakhs.

    — Amar Singh

What to watch in Q1 FY27

EBITDA Margin (Diagnostic Business)

Next two years
Current Consolidated 20.25% (Diagnostic >40%)
Target Consolidated 30-35%

Why it matters

Sustained margin improvement is key to profitability as the company scales and integrates new, lower-margin businesses like pharmacy.

But after two years, we will make more balance and try to achieve the EBITDA around 40% plus-minus. ... We can expect only around 30% or between 30% to 35%.

Risks & concerns

  • Extended receivables from government business

    medium

    Government payments can take up to six months, increasing working capital requirements, though bad debt is not a concern.

    Analyst acknowledged

  • EBITDA margin compression due to aggressive expansion

    medium

    Rapid expansion leads to higher expenses, temporarily lowering consolidated EBITDA margins, but management aims to maintain 30-35%.

    Analyst acknowledged

  • Competition from larger players and hospital chains

    low

    Management states they maintain controlled growth to balance profitability and growth, and hospital chains primarily handle their own super-specialty tests.

    Analyst downplayed

Q&A highlights

8 direct
EBITDA margin sustainability and expansion Direct
Actually, we are making a complete balance between receivable amount and expenses on our expansion programs. And we try to do at least 32%-35% EBITDA, and we are spacing our expansions in the way so that we should not come down to less than 30%.

Addresses analyst concern about past lower margins and clarifies the strategy to balance growth with profitability, targeting 30-35% EBITDA.

Asked by Priyanshu Jain

Diagnostic center expansion targets and investment per center Direct
for this financial year, we have set the target for five comprehensive centers and 20 labs. FY27. For FY27, we have set the target for comprehensive and standalone labs, 20 standalone labs, because we have to cover the whole Uttar Pradesh in next two years, and 40 districts are left at the moment.

Provides specific numerical targets for new center and lab additions for the current and next financial year, along with geographical focus.

Asked by Priyanshu Jain

Government business profitability and receivables Direct
No, sir. EBITDA margins are much higher in government projects. The only issue is when it is a receivable amount. But in case of Punjab and Haryana project, we have to collect the money from the patient, so there is not any receivable issue. But the EBITDA part is definitely much higher. It is more than 40% in case of government projects.

Clarifies that government projects are highly profitable (EBITDA >40%) despite potential receivable delays, due to confirmed business and zero customer acquisition cost.

Asked by Priyanshu Jain

Jeena Sikho partnership and its EBITDA contribution Direct
Sir, we have affiliation for only diagnostic services. We don't have any affiliation with Ayurvedic treatment part. So our EBITDA is always more than 40% whenever we go for any affiliation, any contract. In this case, definitely it is a confirmed business we are getting from Jeena Sikho and our EBITDA is more than 40%.

Confirms high profitability (EBITDA >40%) from the Jeena Sikho partnership, despite lower volume compared to allopathic hospitals, as it's a confirmed business source.

Asked by Vivek Gupta

Need for additional equity raise Direct
No, sir. No. Because we have already floated warrant for INR104 crores and we have collected 25% and rest of the money we will collect in next one year, and that is enough for us to expand whatever plans we are having at the moment. I don't see any dilution of equity in future.

Reassures investors that current funding (warrant proceeds) is sufficient for planned expansion, indicating no immediate equity dilution.

Asked by Vivek Gupta

Related party transactions and interest rates Direct
So these loans and advances are to our group company like hospital, so these are on temporary basis on demand. So whenever they require money, and we are charging interest on it also. ... 12%. 12%. Very short period. And our loans, our loans are 8.9% in Chandan Healthcare, but we are charging 12% from related party company Chandan Hospital.

Clarifies the nature and terms of inter-company loans, noting that Chandan Healthcare charges a higher interest rate (12%) than its own borrowing cost (8.9%).

Asked by Abhijeet

Receivables growth and bad debtors Direct
It is only government business. Sometimes they give in a single shot for six months payment and sometimes they hold for six months. That is the reason you are seeing the credit amount. Mostly it is government, and rest of the receivables are from corporate and these normally they are hardly 45 to 60 days in all. ... No, no. There is no bad debt. In case of government, it is never. There is zero bad debt. Nothing.

Explains the increase in receivables is primarily due to government business payment cycles (up to 6 months) but assures investors there is no risk of bad debt.

Asked by Abhijeet

EBITDA margin discrepancy (20% vs 30-35% target) Direct
EBITDA margin is reduced just because of our consolidated results because it is inclusive of pharmacy. That is the reason. Otherwise, in case of only pathology, it is more than Rajeev, how much it is in case of pathology, EBITDA margin? EBITDA percentage, how much is the EBITDA percent? ... INR6 crores, sir. I mean percentage-wise it will be around 5%. ... Without pharmacy, last year EBITDA was INR43 crores absolute and this year it is INR56.84 crores absolute. ... At the moment, in the last financial year, our EBITDA margin expanded to 164 basis point and it is 20.25%. This is inclusive of pharmacy. That is the reason, you are seeing reduced EBITDA margin just because of pharmacy, because pharmacy is having only 5% EBITDA margin.

Clarifies that the reported 20.25% consolidated EBITDA margin includes the lower-margin pharmacy business (5% EBITDA), while the core diagnostic business maintains over 40% EBITDA.

Asked by Deepak

3 min read 6 chapters

Detailed narrative

Q4 & FY26 Financial Performance Overview

Chandan Healthcare Limited reported a strong close to FY26, with Q4 revenue reaching INR 77.41 crores, marking an 18.96% year-on-year growth. For the full financial year, total income stood at INR 280.67 crores, a robust 20.43% increase over FY25. EBITDA for FY26 grew by 31.02% to INR 56.84 crores, with the EBITDA margin expanding by 164 basis points to 20.25%. Profit After Tax (PAT) for FY26 increased by 22.04% to INR 27.06 crores, achieving a PAT margin of 9.64%, despite a one-time exceptional item of INR 2.92 crores related to new Labor Code implementation.

Strategic Expansion & Milestones

FY26 was a transformative year, marked by pan-India expansion into 13 states, with plans to add three more. The company secured five 10-year PPP projects totaling an estimated INR 800 crores, including advanced MRI and CT scan systems in Punjab, Haryana, and Assam, which are expected to be operational this financial year. A key partnership with Jeena Sikho, an Ayurveda hospital chain, is scaling across 17 states, with Chandan covering over 50% of their hospitals and clinics, contributing INR 4.5 lakhs in daily revenue. The company also entered premium metro markets like Mumbai, Kolkata, Raipur, and Chandigarh with new diagnostic hubs.

Operational Strategy and Network Growth

Chandan Healthcare's growth strategy is based on six core pillars, including a 'one district, one lab' approach, aiming to cover all districts of Uttar Pradesh and Uttarakhand within two years. The company plans to scale its franchise network aggressively, targeting 1,000 operational franchises over the next 24 months, supported by UP Government initiatives. For the current financial year, the company targets opening five comprehensive centers and 20 labs, with similar targets for the next financial year, focusing on a step-wise upgradation from standalone labs to comprehensive centers to maintain profitability.

New Service Offerings and Technology Adoption

The company is enhancing its service portfolio with advanced diagnostics. Two PET scan centers are slated to become operational in Gorakhpur and Kanpur in Q1 FY27. Chandan is also establishing the first genome lab in Uttar Pradesh at Jankipuram, Lucknow, expected to be operational within five to six months. Additionally, there is a strong focus on preventive health checkup programs, particularly targeting Tier 2 and Tier 3 markets where competition from large pathology players is less intense.

Capital Allocation and Funding

For the current financial year, Chandan Healthcare plans an investment of INR 45-50 crores for new comprehensive centers and labs. This capital expenditure will be funded through a mix of internal accruals and proceeds from warrants issued for INR 104 crores, of which 25% has been received and the remaining 75% is expected within the next year. Management confirmed that this funding is sufficient for current expansion plans, and no further equity dilution is anticipated.

EBITDA Margin Dynamics and Receivables

Management clarified that the reported 20.25% consolidated EBITDA margin includes the lower-margin pharmacy business (approx. 5% EBITDA), while the core diagnostic business maintains an EBITDA margin of over 40%. The company aims to maintain consolidated EBITDA between 30-35% in the next two years, eventually targeting 40% plus-minus after two years as expansion stabilizes. Receivables have increased due to government business, where payments can take up to six months, but management assured that there is no risk of bad debt from this segment.

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