Shalby

Shalby Limited delivered a robust Q4 FY26, with consolidated revenue growing 9.4% year-on-year to INR 295.5 crores. EBITDA saw a significant increase of 43.1% to INR 37.4 crores, leading to an EBITDA margin expansion to 12.7% from 9.7% in Q4 FY25. The company's PAT for the quarter stood at INR 18.5 crores, a substantial improvement from a loss of INR 12.2 crores in the prior year, primarily due to operational efficiency and a beneficial change in the tax regime. For the full fiscal year 2026, consolidated revenue reached INR 1,168.2 crores, reflecting a 4.8% growth, with EBITDA at INR 169.6 crores and a healthy margin of 14.5%.

The medical implant business, Shalby MedTech, demonstrated a strong turnaround, achieving positive EBITDA of over INR 3.7 crores in Q4 FY26, a notable improvement from a loss of INR 9.3 crores in the corresponding quarter last year. This marks the second consecutive quarter of positive EBITDA performance for the segment. For the full year FY26, MedTech's consolidated revenue crossed INR 135 crores, growing approximately 46% year-on-year, and recorded a positive EBITDA of approximately INR 6.7 crores, compared to a loss of INR 19.2 crores in FY25. The company aims for MedTech revenue of INR 600-650 crores with double-digit EBITDA margins (upwards of 15%) by 2030.

Standalone operational metrics showed a 2.7% growth in ARPOB to INR 42,689 in Q4 FY26, compared to INR 41,585 in Q4 FY25. Occupied beds increased by 2.4% year-on-year to 649, resulting in an overall occupancy rate of 48%. Excluding the Gurugram unit, the occupancy stood at 50%. The payer mix for Q4 FY26 was 33% self-pay, 37% insurance, and 30% government business. Management anticipates the overall occupancy rate to be north of 50% in the coming year.

Shalby International's Gurugram unit reported revenue of INR 21.5 crores in Q4 FY26, a 5.7% decline from INR 22.8 crores in Q4 FY25. This decline was primarily attributed to the ongoing geopolitical situation in the Middle East, impacting international patient inflows. However, the company is mitigating this by growing business from African and CIS countries, including Uzbekistan and Kazakhstan. The overall international business at the group level contributed INR 12.8 crores in Q4 FY26. Management expressed confidence in a strong comeback for the Gurugram unit, supported by recent NABH accreditation and increased marketing efforts.

The company invested approximately INR 160 crores in FY26, primarily in oncology infrastructure such as LINAC bunkers in Surat and Krishna, and PET and CT Scan facilities in Indore, Jaipur, and Naroda, as well as robotics. These investments are expected to drive significant upside in revenue and profitability. After experiencing doctor attrition and turbulence in Q2 and Q3 FY26, management confirmed that the situation has stabilized in Q4 and current months, with new super specialty doctors joining, contributing to improved performance.

Gross margins experienced a slight decrease from around 90% to 85% in Q4 FY26. This was attributed to the initial costs associated with recruiting new doctors, whose results are expected in subsequent quarters, and investments in oncology treatments requiring expensive medicines. While government business increased, management noted challenges in money recovery but highlighted that recently revised CGHS rates are expected to provide a 7-8% upside to revenues in the coming quarters, which will positively impact the top line.