Fortis Health.

Fortis Healthcare reported a consolidated top line of INR 2,331 crores in Q2 FY26, marking a 17.3% YoY growth. Operating EBITDA increased 28% YoY to INR 556 crores, achieving a margin of 23.9% compared to 21.9% in Q2 FY25. Consolidated PAT before exceptional item^📎s grew 20.7% to INR 305 crores. For H1 FY26, consolidated revenues stood at INR 4,498 crores, up 16.9% YoY, with operating EBITDA of INR 1,047 crores and a margin of 23.3%.

The hospital business revenue grew 19.3% to INR 1,974 crores in Q2 FY26, contributing 85% to consolidated revenue. Operating EBITDA for hospitals was INR 452 crores, with a margin of 22.9%, a 150 basis points improvement YoY. Occupancy rates improved to 71% (from 69% in Q1 FY26), and ARPOB increased 5.8% to INR 2.51 crores per annum, driven by an improved specialty mix. The oncology segment showed significant growth of 29% YoY, increasing its revenue contribution to 16.2%, and medical travel revenue grew 26% to INR 169 crores.

Agilus Diagnostics reported a gross revenue of INR 400 crores in Q2 FY26, a 7.3% YoY growth, and an operating EBITDA of INR 104 crores, with margins expanding to 26.1% from 21.5% in Q2 FY25. The segment conducted 10.6 million tests and added 7 new labs and over 200 customer touchpoints. The preventive portfolio contributed 13% to operating revenue, and the genomics portfolio grew 20% YoY. The dip in volume growth was attributed to discontinuing the Aam Aadmi Mohalla Clinics business and less significant vector-borne diseases, with a strategic focus on higher-ticket wellness packages.

Fortis added 550 operational beds in H1 FY26 through various initiatives, including the acquisition of Shrimann Super speciality Hospital in Jalandhar, which increased total beds in the Punjab cluster to 965. The company also entered a 15-year lease agreement for a 200-bedded multi-specialty hospital in Greater Noida (previously O&M) and signed an O&M agreement for a 550-bedded greenfield super specialty hospital in Lucknow. The integration of Gleneagles units under an O&M agreement is progressing well, with future evaluation for potential acquisition.

As of September 30, 2025, the company's net debt stood at INR 2,219 crores, resulting in a net debt-to-EBITDA ratio of 0.96x, an increase from 0.16x a year prior. This increase was primarily due to funds raised for the acquisition of a 31.5% PE stake in Agilus, the Fortis brand and trademarks, and Shrimann Hospital. Management expressed comfort with the current debt level, noting healthy cash flow generation, and indicated that the debt could potentially reduce to zero in two years if no further growth acquisitions are pursued.

Management anticipates a positive impact from the revised CGHS rates, although they are seeking further clarity on specific details, particularly regarding drug price impact and super specialty services, and acknowledge payment predictability as a concern. Legal expenses, which previously amounted to INR 30-40 crores annually, are expected to reduce by 50% or more following the closure of the open offer and resolution of most legal issues, though some proceedings related to ex-promoters continue.