Health.Global

HealthCare Global reported a strong Q3 FY26 with revenues of INR 633 crore, marking a 13.4% year-on-year growth. Excluding the fertility business, revenues stood at INR 618 crore, supported by an 8% YoY patient volume growth. Adjusted EBITDA for the quarter was INR 111 crore, reflecting a 20% YoY growth, with EBITDA margins expanding 100 basis points to 17.5% from 16.5% in Q3 FY25. Average revenue per patient (ARPP), including the fertility business, was approximately INR 84,000, a 5% YoY increase.

For the nine months ended December 31, 2025, HCG achieved a revenue of INR 1,893 crore, representing a 16% YoY growth, and an adjusted EBITDA of INR 346 crore, a 20% YoY growth. The EBITDA margin for the 9M period improved by 60 basis points to 18.3%. Management expressed confidence in continued operating momentum into the March quarter, expecting it to be the best quarter of the financial year, and reiterated an aspiration to achieve 23-24%+ EBITDA margins within the next three to four years.

HCG highlighted its advanced clinical capabilities, including complex radiation oncology cases using Cyberknife, personalized medical oncology treatments, and robotic surgeries for complex conditions. The company's digital engine significantly contributed to growth, with digital revenue increasing 26% YoY. The website accounted for 67% of digital contribution, while the mobile app scaled 4.5x to contribute 13%. Outpatient volumes grew 26% and inpatient volumes 37%, demonstrating effective patient engagement and referral strategies, alongside a reduction in aggregator dependence from 12% to 9%.

The South cluster delivered 9% YoY revenue growth, with volumes (excluding Andhra Pradesh) growing 11% YoY, despite temporary disruptions from a state-sponsored scheme. The West cluster showed strong performance with 17% YoY revenue growth and 11% YoY volume growth, driven by patient inflows in Gujarat and Maharashtra. The East cluster reported 12% YoY revenue growth and 16% YoY volume growth, though ARPP declined 3% YoY due to scheme transitions. Strategic expansions include the North Bangalore facility (120 beds) commencing operations by Q4 FY26, 20 additional beds at the existing Bangalore COE, and 60 beds at Cuttack Hospital by end of FY27.

The company's pre-tax ROCE stood at 13.3% for 9M FY26, with a target to reach 20% in the next four to five years as centers mature and achieve a revenue threshold of INR 10 crore per month. Planned capex for FY26 is INR 275-280 crore, with a 10-12% increase projected for FY27. Management announced a Board meeting for a Rights Issue, stating that an equity infusion would strengthen the balance sheet and capital structure, with specifics to be shared shortly. The company currently holds INR 200-300 crore in cash available for further growth capex, with net debt around INR 680 crore and a net debt to EBITDA ratio below 1.5x.

HCG currently derives about 3.5% of its revenue from medical tourism, with an endeavor to increase this to 7% in the next four years. Oncology constitutes 25-30% of the overall medical value travel in India, presenting a significant growth opportunity. Historically, the company focused on domestic patients, but post-COVID, it aims to leverage this channel, supported by expansions in metros like Bombay and Kolkata. Approximately 45% of HCG's patients come after seeking initial opinions at multi-specialty hospitals, highlighting its position as a trusted referral center.