Multibagger Stock: Narayan Hrudayalaya is one of the multibagger stocks that Dalal Street has delivered in the post-Covid stock market rebound. Even though this multibagger healthcare stock has remained negative to negative over the past one year, it has delivered returns of nearly 250 percent to its long-term investors over the past four years. In fact, the stock witnessed heavy buying interest by the bulls as they entered 2019. In this period, this healthcare stock has gained almost ₹200 to ₹715 per share.
However, Prabhudas Lilladher has 'Buy' tag on this healthcare stock, despite the negative trend since last one year. The brokerage believes that the stock can go up to ₹965 per share in the long term. The share price of Narayana Hrudayalaya today on NSE is around ₹715 per share, which means the brokerage is expecting over 250 per cent returns from this healthcare stock.
Highlighting the fundamentals that have fueled the Narayana Hrudayalaya share price rally, the brokerage says, "Narayana Hrudayalaya reported pre-IND AS EBIDTA of ₹2.4bn, above our estimates (Rs 2.1bn). St in Q3 Adjusted for Lucia's EBITDA loss, EBIDTA was up 3% QoQ and 50% YoY. Overall, margins improved by 430 bps YoY and 120 bps QoQ to 22.6%. India business with strong EBIDTA of Rs1.6bn Continues to report ; up 6% QoQ and 58% YoY. Cayman reported EBIDTA of USD 11.5mn vs USD 12.5mn in Q2 and USD 10.1mn in Q3FY22. OPM was 41.2%, down 270 bps QoQ.
The brokerage further said, "Revenue grew 18% YoY (down 1% QoQ) to Rs11.3bn. ARPOB for India business grew 4% QoQ to 35,068/day, aided by improved payer mix." 10% YoY for India. Cayman revenue grew 13% YoY to $28.2mn (down 3% QoQ). Discharge was down 17% while OP volumes for Cayman were up 13% YoY; ARPOB was up 10% YoY. PAT Net debt declined from Rs.535mn to Rs2.1bn (up 58% YoY) at Rs1.5bn.
On stock market investors suggestion regarding Narayana Hrudayalaya shares, Prabhudas Lilladher said, "We expect to maintain the growth momentum. The company plans to continue with its aggressive capex plan for the next 2-3 years." is guided by an annual capex of Rs 10 billion. in FY23E and FY24E. More significantly the capex spend will be towards its core and high performing regions such as Bangalore, Kolkata and Cayman. Rs 965/share (earlier Rs Maintain 'Buy' rating with a revised TP of 920 / share). 20x FY25E EV/EBITDA for India business and 12x EV/EBITDA for Cayman Hospitals."
The brokerage further said that at current market prices, Narayana Hrudayalaya stock is trading at attractive valuations of 13x EV/EBITDA (adj to IND AS) and 20x P/E on FY25E. Rapid growth in the new Cayman unit will be a key.
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