Detailed Narrative
Exceptional Q3 FY26 Financial Performance
Yatharth Hospitals reported its highest-ever quarterly revenue and profitability in Q3 FY26, with revenue growing 46% year-over-year and 15% quarter-over-quarter to INR3,205 million. EBITDA increased by 35% YoY to INR742 million, and adjusted EBITDA margin stood strong at 29.2%. Net profit after tax (PAT) saw a 41% YoY increase to INR431 million, with adjusted PAT growing 80% YoY, demonstrating robust financial health.
Successful Scale-Up of New Facilities and Strategic Payer Mix
The newly operational New Delhi and Faridabad Sector-20 hospitals significantly contributed to the quarter's performance, generating INR279 million in revenue and accounting for 9% of the group's total. These facilities achieved strong initial ARPOB of INR40,000 and INR36,000 respectively, with 100% of their revenues derived from cash and TPA. This aligns with the company's strategic goal to reduce government payer mix in newer hospitals to a maximum of 15-20% within 1-2 years, thereby improving operational efficiencies and debtor days.
Aggressive Capacity Expansion and M&A Integration
Yatharth Hospitals is pursuing an ambitious expansion plan to increase its total bed capacity from 2,550 to 5,000-6,000 beds over the next 3-4 years, involving a combined capex of INR1,500 crores over five years. The recently acquired Agra hospital was fully integrated into the network on February 1, 2026, and is expected to contribute meaningfully to revenue and EBITDA from Q4 FY26, having already been EBITDA and P&L positive with INR45-50 crores in revenue in the last 12 months.
Focus on Super-Specialties and Oncology Growth
The company is strategically enhancing its super-specialty services, with oncology currently contributing 10% to the overall specialty pie. Oncology revenue grew significantly from INR63 crores to INR85 crores year-over-year. Management expects oncology's contribution to reach 15% within 1.5 to 2 years, driven by the introduction of full-scale oncology services in the new Faridabad and New Delhi hospitals, underscoring a shift towards higher-value clinical offerings.
Receivables Management and Liquidity Position
As of December 31, 2025, the company maintained a healthy cash and bank position of INR200 crores. While the blended receivable days stood at around 115, management is actively working to reduce this to less than 110 days by March 2027 and further to 80-82 days within two years. This reduction is being achieved through rigorous collection protocols, outsourcing recovery teams, and a strategic shift away from slower-paying government channels like ESI.
Positive Outlook and Margin Trajectory
Management expressed confidence in continued growth and margin expansion, expecting Q4 FY26 to be even better than Q3 due to new hospital integrations and recent CGHS price revisions. They project a blended EBITDA margin of 24-25% at a consolidated level, acknowledging that continuous new hospital additions will impact the blended margin but emphasizing that margins from mature hospitals would be 3-3.5% higher. The company also anticipates ARPOB to grow by approximately 10% year-over-year.