Equity L/S Analyst | Forensic Accounting | India, Yellowstone Equity

Ankit Agrawal, CFA

Equity L/S Analyst | Forensic Accounting | India

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Yellowstone Equity

Providing unbiased and independent research on Indian equities to global institutions and individual investors


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Regulatory Disclosure: 
Note that Ankit Agrawal (Proprietor of Yellowstone Equity) is a SEBI registered Research Analyst (Registration No.: INH000007216). Registration granted by SEBI and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors. Investment in securities market are subject to market risks. Read all the related documents carefully before investing.

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Address: A-412, Shilp Aaron, Sindhu Bhavan Road, Ahmedabad, Gujarat - 380059
Email: services@yellowstoneequity.com
Mobile: +91-7575817289

Compliance/Grievance Officer:
Name: Ankit Agrawal
Email: services@yellowstoneequity.com
Mobile: +91-7575817289
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Equity Bottom-Up

HealthCare Global Enterprises / Equity Bottom-Up

<ul>
<li>In line with our thesis, HCG has been scaling up well led by rapid growth in emerging centers. Established centers are also growing at a steady pace.  </li>
<li>With scale, profitability is normalizing. Over the next two years, we project the EBITDA to grow at 25% CAGR led by margin expansion and volume growth.</li>
<li>Utilization on like to like basis came in at 76% in Q1FY26 vs 69% in FY25. ARPOB has been steady at around INR 45000.</li>
</ul>


In line with our thesis, HCG has been scaling up well led by rapid growth in emerging centers. Established centers are also growing at a steady pace.  
With scale, profitability is normalizing. Over the next two years, we project the EBITDA to grow at 25% CAGR led by margin expansion and volume growth.
Utilization on like to like basis came in at 76% in Q1FY26 vs 69% in FY25. ARPOB has been steady at around INR 45000.


Healthcare Global (HCG): Next Two Years Look Promising

<ul>
<li>
<a href="https://www.smartkarma.com/entities/healthcare-global-enterprises-limited" target="_blank" data-smartkarma-citation="entities:23983:1" rel="noopener">HCG</a>  continues to scale up well with the emerging centers reporting 32% YoY revenue growth in Q4FY25. Q4FY25 revenue from established centers also grew strong at 22% YoY.</li>
<li>International footfalls have resumed strong, led by which the revenue in the South Mumbai center grew 38% YoY. Revenue in Kolkata center also grew well at 22% YoY.</li>
<li>HCG has been in consolidation phase over the last four years. Now, the next two years should witness strong growth in profitability, led by margin expansion and continued volume growth.</li>
</ul>



HCG  continues to scale up well with the emerging centers reporting 32% YoY revenue growth in Q4FY25. Q4FY25 revenue from established centers also grew strong at 22% YoY.
International footfalls have resumed strong, led by which the revenue in the South Mumbai center grew 38% YoY. Revenue in Kolkata center also grew well at 22% YoY.
HCG has been in consolidation phase over the last four years. Now, the next two years should witness strong growth in profitability, led by margin expansion and continued volume growth.


Healthcare Global (HCG): Beyond Consolidation Now, Next Two Years Could Be Strong

<ul>
<li>
<a href="https://www.smartkarma.com/entities/healthcare-global-enterprises-limited" target="_blank" data-smartkarma-citation="entities:23983:1" rel="noopener">HealthCare Global Enterprises ("HCG")</a> reported a strong Q3FY25 despite Q3 being a seasonally weak quarter. Revenue growth was strong across both the established centers and the emerging centers.</li>
<li>Revenue from established centers grew 20% YoY while that from emerging centers grew 25% YoY in Q3FY25. Within emerging centers, Kolkata led the growth with 40% YoY rise in revenues.</li>
<li>HCG saw promoter change in Feb 2025. KKR announced acquisition of 54% stake from CVC who owns around 60%+. Dr. BS Ajaikumar, the founder promoter, will continue to own 10%+.</li>
</ul>



HealthCare Global Enterprises ("HCG") reported a strong Q3FY25 despite Q3 being a seasonally weak quarter. Revenue growth was strong across both the established centers and the emerging centers.
Revenue from established centers grew 20% YoY while that from emerging centers grew 25% YoY in Q3FY25. Within emerging centers, Kolkata led the growth with 40% YoY rise in revenues.
HCG saw promoter change in Feb 2025. KKR announced acquisition of 54% stake from CVC who owns around 60%+. Dr. BS Ajaikumar, the founder promoter, will continue to own 10%+.


HCG: Strong Q3FY25 and Promoter Change Update

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Event-Driven

HealthCare Global Enterprises / Event-Driven

<ul>
<li>KKR has signed definitive agreements to acquire up to 54% of HCG from CVC Asia V, positioning itself as the largest shareholder and assuming sole operational control.</li>
<li>This will trigger an open offer to buy an additional 26% stake at a price of INR 504.41 per share. </li>
<li>Now, HCG will be seen as a transformed healthcare leader with a robust growth trajectory, driven by global expertise and strategic restructuring for long-term value creation.</li>
</ul>


KKR has signed definitive agreements to acquire up to 54% of HCG from CVC Asia V, positioning itself as the largest shareholder and assuming sole operational control.
This will trigger an open offer to buy an additional 26% stake at a price of INR 504.41 per share. 
Now, HCG will be seen as a transformed healthcare leader with a robust growth trajectory, driven by global expertise and strategic restructuring for long-term value creation.


Event Driven: KKR Acquired Controlling Stake in HealthCare Global

<ul>
<li>As HCG's scale is growing and as its emerging centers are maturing, profitability is improving. Adjusted EBITDA crossed INR 100cr mark for the first time ever.</li>
<li>EBITDA grew by 21% YoY in Q2FY25 with EBITDA margin improving to 18.8% vs 17.8% YoY. Q2FY25 revenue also grew healthy at 14% YoY to reach INR 550cr+.</li>
<li>HCG also announced acquisition of a cancer hospital in Vizag that is margin accretive. Including this acquisition, EBITDA margin is 19% and proforma revenue growth is 20% YoY.</li>
</ul>


As HCG's scale is growing and as its emerging centers are maturing, profitability is improving. Adjusted EBITDA crossed INR 100cr mark for the first time ever.
EBITDA grew by 21% YoY in Q2FY25 with EBITDA margin improving to 18.8% vs 17.8% YoY. Q2FY25 revenue also grew healthy at 14% YoY to reach INR 550cr+.
HCG also announced acquisition of a cancer hospital in Vizag that is margin accretive. Including this acquisition, EBITDA margin is 19% and proforma revenue growth is 20% YoY.


Healthcare Global (HCG): Strong Q2FY25 Led by Operating Leverage

India

HealthCare Global Enterprises Limited provides medical and surgical hospital services. The Hospital offers cancer care, chemotherapy, cyberknife surgery, surgical, radiation, and medical oncology services. HealthCare Global Enterprises operates worldwide.

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HealthCare Global Enterprises (HCG IN)

Healthcare Global (HCG): Next Two Years Look Promising

HCG is executing well led by organic growth and strategic acquisitions. The next couple of years look promising with EBITDA likely to grow at 25%...

Ankit Agrawal, CFA

Healthcare Global (HCG): Beyond Consolidation Now, Next Two Years Could Be Strong

HCG is scaling up well led by prudent acquisition and growth in emerging centers. The next two years should witness strong growth in profitability...

Ankit Agrawal, CFA

HCG: Strong Q3FY25 and Promoter Change Update

HCG is growing from strength to strength led by prudent expansion and focus on best clinical outcomes. At current valuation, an investment in HCG...

Ankit Agrawal, CFA

Event Driven: KKR Acquired Controlling Stake in HealthCare Global

KKR acquires majority stake in HCG, triggering open offer for additional shares at INR 504.41 per share. HCG poised for growth as healthcare...

Nimish Maheshwari

Healthcare Global (HCG): Strong Q2FY25 Led by Operating Leverage

HCG is scaling up well led by operating leverage and growing vintage of its emerging centers. It is also making strategic acquisitions to further...

Ankit Agrawal, CFA

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Healthcare Global (HCG): Next Two Years Look Promising

HCG is executing well led by organic growth and strategic acquisitions. The next couple of years look promising with EBITDA likely to grow at 25%...

Ankit Agrawal, CFA

Healthcare Global (HCG): Beyond Consolidation Now, Next Two Years Could Be Strong

HCG is scaling up well led by prudent acquisition and growth in emerging centers. The next two years should witness strong growth in profitability...

Ankit Agrawal, CFA

HCG: Strong Q3FY25 and Promoter Change Update

HCG is growing from strength to strength led by prudent expansion and focus on best clinical outcomes. At current valuation, an investment in HCG...

Ankit Agrawal, CFA

Event Driven: KKR Acquired Controlling Stake in HealthCare Global

​KKR acquires majority stake in HCG, triggering open offer for additional shares at INR 504.41 per share. HCG poised for growth as healthcare...

Nimish Maheshwari

Healthcare Global (HCG): Strong Q2FY25 Led by Operating Leverage

HCG is scaling up well led by operating leverage and growing vintage of its emerging centers. It is also making strategic acquisitions to further...

Ankit Agrawal, CFA

KKR acquires majority stake in HCG, triggering open offer for additional shares at INR 504.41 per share. HCG poised for growth as healthcare...