Hygeia Healthcare Group (6078 HK): Growth and Margin Concerns Plague Inherent Valuation

395 Views08 Jan 2025 21:34

SUMMARY

In 1H24, Hygeia Healthcare Group (6078 HK) reported revenue growth of 35% YoY to RMB2,382 million, mainly driven by a 37% YoY growth in hospital business.
Hygeia’s gross profit margin contracted 60bps YoY to 31.8%. Lower government grant led to 230bps operating margin squeeze to 21.6%.
The share price of Hygeia Healthcare has gone down almost 56% in the last one year. Accelerated organic growth and strengthening of margins are crucial to boost valuation.

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