Krishna Institute of Medical Sciences Q1 FY27 earnings call

KIMS Hospitals reported a total revenue of INR 1,196 crore for Q1 FY27, marking a significant growth of 36.1% year-on-year and 10.3% quarter-on-quarter. Consolidated revenue from operations was INR 1,180 crore, up 35.3% YoY. EBITDA stood at INR 240 crore, growing 20.1% YoY and 10.9% QoQ, with an EBITDA margin of 20.1%. However, PAT for the quarter was INR 37 crores, a decrease from INR 85 crore in Q1 FY26.

The company saw impressive growth in patient volumes, with IP volumes increasing by 26.6% YoY to 72,493 and OP volumes growing by 28.5% YoY to 6,58,617. Average revenue per operating bed (ARPOB) grew by 9.7% YoY, while average revenue per patient (ARPP) grew by 6.8% YoY. Management clarified that actual operational bed occupancy is higher than reported, as 250 beds in Secunderabad are under renovation and 450 new Kondapur beds were added only in the last 10 days of Q1, leading to a current cluster occupancy of 61%.

KIMS successfully raised INR 1,500 crores through a Qualified Institutional Placement (QIP), utilizing INR 1,100 crores to reduce its debt. This brought down the gross debt from INR 3,250 crore at March 31, 2026, to approximately INR 2,400 crore by early July. The company plans to deploy internal accruals for greenfield and brownfield growth, aiming to maintain a debt-equity ratio of 2.5:1. Maintenance CAPEX is projected at INR 100 crore per year for the next 3-4 years.

The newly commissioned Kondapur Hospital showed promising initial results with 40% growth in less than a month, achieving INR 45 crore revenue in July. Mahadevapura, Bangalore, became EBITDA positive in under seven months, with July revenue of INR 20 crore. Electronic City, Bangalore, is expected to break even in the next one to two quarters. The Thane unit, affected by seasonal weakness and empanelment delays, recorded INR 21 crore revenue and 10% EBITDA margin in July, with expectations of a healthy EBITDA margin in Q2 FY27.

Significant progress has been made on empanelments for new units, with 50% of insurance companies now empanelled for four assets (Thane, Nashik, and two Bangalore units). Key empanelments are expected to be completed by August/September, with the majority in place by fiscal year-end. The company's growth strategy remains focused on its core markets of Telangana, Andhra, Maharashtra, Karnataka, and Kerala, with no plans to enter new geographies, but rather to expand within existing ones.

Management anticipates Kerala units to achieve mid-single digit EBITDA margins this year, scaling to 20-22% in three to four years. For the Telangana cluster, occupancy is targeted to reach 70% in three to four years. Overall, with 65-70% utilization by FY30 (assuming no new beds are added), the company expects to achieve a 30% EBITDA margin. The full potential of the Kondapur unit is projected at INR 1,200 crore annual revenue with around 30% EBITDA margin in 4-5 years.

The old Kondapur hospital remains operational, incurring a monthly cost of approximately INR 90 lakhs plus GST in rental expenses, along with an additional INR 3-4 crore in operational costs. Management expects to make a decision regarding the future of this facility within the next six months, aiming to eliminate this ongoing cost drag.