Detailed Narrative
Q4 and FY26 Performance Overview
Max Healthcare delivered its 22nd consecutive quarter of year-on-year growth, with Q4 FY26 Network gross revenue increasing by 10% to INR 2,664 crore and operating EBITDA growing by 8% to INR 682 crore. For the full year FY26, Network gross revenue stood at INR 10,538 crore, reflecting a 16% YoY growth, and operating EBITDA grew by 14% to INR 2,638 crore. Profit after Tax (PAT) for FY26 increased significantly by 22% to INR 1,631 crore compared to INR 1,336 crore in FY25.
Capacity Expansion and Commissioning
The company initiated phased commissioning of over 20% additional brownfield capacity across hospitals in Mohali, Nanavati, and Max Smart, with all beds expected to be operationalized within the next 2-3 months. An additional 10% capacity is anticipated from the 500-bed greenfield hospital in Gurgaon, targeted for commissioning by the end of this year. Max Lucknow's capacity is set to increase from 426 to 570 beds over the next two quarters, with other projects like Max Nagpur (100 beds) and Zirakpur, Mohali (400 beds) on track for commissioning by FY28.
Strategic Acquisitions and New Projects
Max Healthcare completed the acquisition of a controlling stake in Kalinga Hospital Limited, a 250-bed facility in Bhubaneswar, marking its entry into Eastern India. This asset is already profitable, contributing approximately INR 10 crore EBITDA per quarter, and its integration will begin in Q1. Furthermore, the Board approved a significant investment of INR 1,400 crore for the construction of a 700-bed greenfield hospital at Shaheed Path, Lucknow, which is expected to take about 3 years to build.
Impact of Oncology Drug Discontinuation
The share of oncology in in-patient revenues dropped to 21% in Q4 FY26 from 26% in Q4 FY25, primarily due to the discontinuation of select high-value chemotherapy drugs. This decision was made because the margins on these drugs were deemed 'perverse' after a 30% discount requirement. The discontinuation impacted both the top line and occupied bed days (OBDs) in oncology, with a 5-6% degrowth in oncology OBDs, and management expects the oncology share to stabilize around 21-22% going forward⏳.
Operational Metrics and Digital/International Growth
Despite the increase in operational bed capacity, average occupancy for the Network remained strong at over 75%. Occupied bed days (OBDs) were up by 8% YoY and 4% QoQ. However, Average Length of Stay (ALOS) increased by 9% YoY, which temporarily impacted Average Revenue Per Occupied Bed (ARPOB) at INR 77,900. International patient revenue grew 12% YoY to INR 227 crore, accounting for 9% of hospital revenue, while digital revenue from online marketing activities reached INR 838 crore, representing 31% of overall revenue.
Capital Allocation and Financial Health
The company generated robust free cash flows of INR 581 crore in Q4 and INR 1,541 crore for the full year FY26. INR 328 crore was deployed in Q4 towards ongoing capacity expansion and facility upgrades, with a total of INR 1,627 crore deployed for such purposes in FY26. Net debt for the Network reduced to INR 1,908 crore from INR 2,166 crore at the end of December '25, maintaining a healthy Net debt-to-EBITDA ratio of less than 1. Additionally, INR 146 crore was distributed as dividend in FY26.