Target: ₹9,444

CMP: ₹8,359.75

Apollo Hospitals Enterprise (APHS) reported robust 18 per cent y-o-y consolidated topline growth in Q4-FY26, with all three segments firing in tandem - hospitals and pharmacy sustaining healthy growth trajectories while group margins benefited from a meaningful narrowing of online-pharmacy losses and strong margin in Apollo Health and Lifestyle Ltd (AHLL).

Hospital revenue rose 16 per cent y-o-y to ₹3,270 crore, with ARPP up 9.2 per cent on a richer case mix (CONGO-T: +22 per cent). We model a 16 per cent revenue CAGR over FY26-FY28E, as about 1,400 beds get commercialised by FY28 (around 900 in FY27; balance in FY28).

Pharmacy revenue rose 20 per cent y-o-y to ₹2,850 crore, driven by 21 per cent offline growth. A combination of 600 annual store additions, mid-teen SSSG & high-teen online GMV growth should sustain this momentum, pointing to an 18 per cent revenue CAGR over the medium term.

While FY27 absorbs near-term margin dilution from capacity additions, we model 100bps of group EBITDA margin expansion to 16 per cent over FY26–FY28E.

Key drivers are: EBITDA accretion as new hospitals scale, higher contribution from high-value CONGO-T specialties and pharmacy profitability improving as digital turns EBITDA positive.

Retain Long with a SOTP-based Mar’27 TP of ₹9,444, valuing hospitals/pharmacy/AHLL businesses at 26x/25x/15x EV/EBITDA.

Published on May 22, 2026