Healthcare Global Enterprises Limited — Q4 FY25 earnings call

Call held 4 Dec 2025

Management summary

HealthCare Global Enterprises Limited reported strong FY2025 results with revenue of ₹2,200 crores and EBITDA of ₹396 crores, demonstrating 15% and 18% CAGRs respectively over the last five years. The company successfully deleveraged its balance sheet, reducing net debt to EBITDA to 2.3x. HCG outlined a clear strategy for future growth, focusing on optimizing its existing network, brownfield and greenfield expansions, and improving profitability towards 21-22% EBITDA margins and 20%+ ROCE for mature centers.

Highlights

  • Achieved ₹2,200 crores revenue in FY2025 with a 15% CAGR (FY20-25), outpacing industry growth.

  • EBITDA grew at an 18% CAGR (FY20-25) to ₹396 crores, driven by operational efficiency and network maturity.

  • Significantly deleveraged, reducing net debt to EBITDA from 6.2x in FY2020 to 2.3x in FY2025.

  • Maintained an industry-leading gross mortality rate of 0.9%, half to one-third of multi-specialty peers.

  • Identified 10-12 attractive cities for greenfield expansion and planning to add 1000 beds and 10 LINACs.

Concerns

  • Past underperformance of some new centers, requiring improved accountability and performance.

  • Mumbai center historically faced challenges in ramping up, though overall Bombay cluster is now a top oncology player.

  • Milann fertility business is under strategic evaluation, with potential for divestment, indicating a shift away from non-core assets.

Key financials

3 periods

Headline

  • Revenue
    ₹2,200 Cr
  • EBITDA
    ₹396 Cr
  • Gross Mortality Rate
    90%

FY20-25

  • Revenue CAGR
    15%
  • EBITDA CAGR
    18%

FY25

  • Net Debt to EBITDA
    2.3×

What they filed

Q1 FY27: revenue up 13.4%, net profit up 166.7% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue554 559 585 613 647 +17%633 +13%652 +11%695 +13%
EBITDA102 88 106 108 123 +21%110 +25%125 +18%122 +13%
Net profit21 8 7 6 21 +0%-8 −200%4 −43%16 +167%
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

Share of Revenue (FY25)
₹2,163 Cr Total
  • West Cluster ₹990 Cr 45.8%
  • South Cluster ₹875 Cr 40.5%
  • East Cluster ₹255 Cr 11.8%
  • International ₹43 Cr 2.0%

Capital allocation

high confidence
  • Capex ₹600 Cr Internal accruals and available borrowing headroom
    • Expansion (brownfield and greenfield) ₹350 Cr
    • Maintenance capex (annual) ₹90 Cr
    • Upgrading infrastructure and increasing existing capacity
    In addition, we would like to spend additional Rs.500 crore to Rs.600 crore over the next two, three years to fund expansion. Each centre with our specifications will cost us about Rs.100 crore or in that range, depending on the market. We want to spend capex on increasing our existing capacity. And also, most importantly, is to upgrade facilities and infrastructure so that they are in line with patient expectations, post which we expect a total capex to be around 30% to 35% of our EBITDA. (page 16) ... So in the next two to three years, it is about Rs. 600 crore to Rs.700 crore, out of which about Rs.300 crore will be maintenance capex. And the rest will be for upgrading our infrastructure, increasing our existing capacity, and so on and so forth. (page 22)
  • Debt 2.3× EBITDA
    our net debt to EBITDA ratio, which was 6.2x, in FY2020 has come down to 2.3x in FY2025.

Guidance & targets

Revenue

  • Revenue Growth Revenue · medium-to-long term · High confidence sustain if not exceed 15% per annum
    Looking ahead, we aim to sustain if not exceed this momentum and continue to grow faster than the overall market that is a key direction that we are going in and this will be driven by a couple of factors first, we want to realise the full potential of our existing network.

    — Manish Mattoo

  • Achieving full revenue potential Revenue · Four to five years · Medium confidence full potential
    Given what is the time frame that you have in mind to achieve that potential then? Four to five years.

    — Manish Mattoo

Profitability

  • EBITDA Growth Profitability · future · High confidence faster than 18% CAGR
    And we expect our EBITDA to grow at a faster pace than this historical CAGR and which will be driven by a couple of measures again.

    — Manish Mattoo

  • ROCE for mature centers Profitability · next five years · High confidence 20% plus
    So overall, I feel we expect a trend of at least a 20% plus ROCE over the next five years.

    — Manish Mattoo

Margin

  • Corporate EBITDA Margin Margin · future · High confidence upwards of 21%, 22%
    Obviously, it is upwards of 21%, 22%. We expect to be in that range at a corporate level.

    — Manish Mattoo

  • Long-term EBITDA Margin (mature centers) Margin · long term (4-5 years) · Medium confidence 27%-28%
    But as you see, some of our mature centres are delivering 27%-28% margin as well on a pre-corporate cost basis and that is the long term vision for the company overall. ... I would say this journey is around four to five years. That is the timeline we have in mind for delivering these margins similar to mature centres on a pre-corporate cost basis.

    — Manish Mattoo

Volume

  • Realization Growth Volume · every year (upcoming years) · High confidence 4% to 5%
    Overall, we are looking at 4% to 5% realisation improvement every year.

    — Manish Mattoo

  • Inpatient Volume Growth (existing centers) Volume · upcoming years (near to midterm) · High confidence 9% to 10%
    And the volume growth will be in the region of 9% to 10%. And that is what we are anticipating in the near to midterm.

    — Manish Mattoo

Capex

  • Total Capex Capex · next two to three years · High confidence Rs. 600 crore to Rs.700 crore
    So in the next two to three years, it is about Rs. 600 crore to Rs.700 crore, out of which about Rs.300 crore will be maintenance capex. And the rest will be for upgrading our infrastructure, increasing our existing capacity, and so on and so forth.

    — Manish Mattoo

Debt

  • Net Debt to EBITDA Debt · near term · High confidence 2 to 2.5x (pre-Ind AS)
    We are able to fund our growth capex through a combination of free cash flow and available borrowing headroom, because we want to prudently maintain our net debt to EBITDA threshold at 2 to 2.5x on a pre-Ind AS basis in the near term.

    — Manish Mattoo

Capacity

  • Brownfield Expansion (Beds) Capacity · future · High confidence about 1,000 beds
    between brownfield and greenfield expansions, we are anticipating that we will add about 1,000 beds to our current capacity and add 10 additional LINACs in the future.

    — Manish Mattoo

  • Brownfield Expansion (LINACs) Capacity · future · High confidence 10 additional LINACs

    — Manish Mattoo

Market Share

  • Greenfield Expansion (Cities) Market Share · future · High confidence 10 to 12 markets/cities
    We have identified 10 to 12 markets, 10 to 12 cities, which we feel are attractive, which fit into our strategic and financial framework where we feel HCG has a right to win...

    — Manish Mattoo

What to watch in Q1 FY26

Corporate EBITDA margin improvement

Next quarters
Current 19% (Q2)
Target Towards 21-22%

Why it matters

Key indicator of operational efficiency and profitability improvement, central to management's guidance.

As far as EBITDA margins are concerned, we are at 19% in Q2. We have delivered an EBITDA margin of 19% in Q2. And as I had said, based on our higher-than-market revenue growth and operating leverage, we expect the margins to grow faster than the historical trend. Obviously, it is upwards of 21%, 22%. We expect to be in that range at a corporate level.

Risks & concerns

  • Past underperformance of some new centers

    medium

    Management acknowledged past concerns about some centers' performance but outlined new strategies for improvement.

    Analyst acknowledged

  • Challenges in ramping up specific centers (e.g., South Mumbai)

    low

    Management acknowledged historical challenges in South Mumbai but highlighted overall cluster strength and ongoing initiatives.

    Analyst acknowledged

Q&A highlights

8 direct
Future revenue growth outlook Direct
See, over the last five years, we have consistently delivered revenue growth of over 15% per annum, and that has outpaced the broader industry trajectory. Looking ahead, we aim to sustain if not exceed this momentum and continue to grow faster than the overall market...

Clarifies management's expectation for continued strong revenue growth, driven by existing network potential, brownfield expansion, and improved case mix.

Asked by Gaurav Tinani

EBITDA margin trajectory Direct
And we expect our EBITDA to grow at a faster pace than this historical CAGR and which will be driven by a couple of measures again. We will be sweating out our existing infrastructure. We will be bringing in operational efficiencies. There will be operating leverage that will come into play by improvement in our payor mix...

Provides insight into the drivers for margin expansion, including operational efficiencies and payor mix improvement, targeting faster EBITDA growth than historical.

Asked by Gaurav Tinani

Sustainable ROCE outlook Direct
So overall, I feel we expect a trend of at least a 20% plus ROCE over the next five years.

Sets a clear financial target for capital efficiency, indicating confidence in the profitability of mature and maturing centers.

Asked by Gaurav Tinani

HCG's positioning against multi-specialty hospitals in oncology Direct
cancer is a very complex disease to handle and it requires a super-speciality focus, which we have delivered and shown that clinical outcomes that we deliver are far superior to multi-speciality hospitals.

Reaffirms HCG's core value proposition of specialized cancer care leading to superior outcomes, differentiating it from general multi-specialty players.

Asked by Param Desai

Strategy for greenfield/inorganic growth given past underperformance of some new centers Direct
from the learning of the past, and the due diligence that we have done, as I said, we have identified a couple of markets where we feel confident of them being attractive, whether it is high cancer incidence, low penetration of cancer care beds, or availability of clinical talent.

Addresses concerns about past expansion strategies and highlights a more disciplined, data-driven approach to market selection for future growth.

Asked by Param Desai

Capital outlay for growth targets Direct
we would like to spend additional Rs.500 crore to Rs.600 crore over the next two, three years to fund expansion. Each centre with our specifications will cost us about Rs.100 crore or in that range... post which we expect a total capex to be around 30% to 35% of our EBITDA.

Provides specific capex figures and funding strategy, linking it to EBITDA, offering clarity on future investment plans.

Asked by Param Desai

Payor mix optimization, specifically reducing institutional mix Direct
as far as optimizing the payor mix is concerned, as I had mentioned, it will be driven by a couple of factors. One is the kind of infrastructure that we are upgrading it to. Second how are you focusing on optimizing and enhancing patient experience significantly?

Details the multi-pronged approach to shift towards a more favorable payor mix, including infrastructure upgrades, patient experience, and sales/marketing efforts.

Asked by Sumit Gupta

Strategic options for Milann fertility business Direct
I think one of the options, while we are still evaluating, just to be very clear, could be divestment of this vertical. But again, not a definitive answer at this point in time, because we are evaluating various options.

Reveals a potential strategic shift away from the Milann fertility business, indicating a sharper focus on core oncology.

Asked by Rajas Joshi

3 min read 7 chapters

Detailed narrative

Company Overview & Market Leadership

HealthCare Global Enterprises Limited (HCG) stands as India's largest cancer-focused oncology platform, operating 25 hospitals across 10 states and 19 cities, holding a leading position in 16 of these markets. The company's infrastructure includes over 2,500 beds and the largest LINAC installation base of 38 LINACs. HCG's patient-centric approach and specialized focus have resulted in an industry-leading gross mortality rate of 0.9%, which is significantly lower than multi-specialty peers.

Financial Performance & Growth Drivers (FY20-25)

In FY2025, HCG achieved a revenue of ₹2,200 crores, demonstrating a 15% Compound Annual Growth Rate (CAGR) from FY2020. EBITDA for the same period doubled to ₹396 crores, growing at an 18% CAGR, driven by a sharper focus on operational efficiency and the improving maturity of its network. The company successfully deleveraged its balance sheet, reducing its net debt to EBITDA ratio from 6.2x in FY2020 to 2.3x in FY2025.

Strategic Pillars & Future Outlook

HCG's future strategy is built on four pillars: optimizing the existing network, growth through brownfield and greenfield expansions, improving network efficiency, and enhancing patient experience. The company aims to sustain or exceed its historical revenue growth of 15% and achieve EBITDA growth faster than its historical 18% CAGR. Long-term targets include a corporate EBITDA margin of 21-22% and 20%+ Return on Capital Employed (ROCE) for mature centers within the next five years.

Cluster-Based Business Model

HCG has transitioned to a region-based, cluster-based framework (South, West, East, and International) to leverage regional synergies and improve accountability. The South cluster generated ₹875 crores revenue in FY2025 (13% CAGR), the West cluster ₹990 crores (17% CAGR), and the East cluster ₹255 crores (26% CAGR). The company is currently operating at 50-60% of its overall revenue potential, indicating significant headroom for growth within its existing infrastructure.

Capital Allocation & Balance Sheet

HCG plans a capital outlay of ₹600-700 crores over the next two to three years for expansion, in addition to an annual maintenance capex of ₹90-100 crores. This expansion capex will be funded through internal accruals and available borrowing headroom, with a target to keep total capex at 30-35% of EBITDA. The company aims to maintain its net debt to EBITDA ratio within the 2-2.5x range (pre-Ind AS), reflecting a disciplined approach to capital allocation.

Clinical Differentiation & Technology Investment

HCG emphasizes its clinical differentiation through a comprehensive, multi-modality approach, including advanced diagnostics, genomics, and a robust Tumour Board platform that has reviewed over 40,000 cases. The company has consistently invested in cutting-edge technology, such as LINACs, Tomotherapy, CyberKnife, and plans to install an MR LINAC, contributing to superior patient outcomes and attracting top clinical talent. This continuous investment ensures HCG remains at the forefront of cancer care.

Milann Business Review

The Milann fertility business, acquired in 2019, has been a focus for stabilizing operations and profitability. However, HCG's primary focus is now on cancer care, and the company is evaluating several strategic options for Milann, including a potential divestment of this vertical. This indicates a strategic move to sharpen its core business focus on oncology and potentially divest non-core assets.

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