Khambatta Securities has given Buy recommendation for Krishna Institute of Medical Sciences with a target price of Rs. 1776 in its research report issued on Mar 14, 2022

Khambatta Securities’ research report on Krishna Institute of Medical Sciences

Founded by renowned cardiothoracic surgeon Dr. B Bhaskara Rao and headquartered in Hyderabad, Krishna Institute of Medical Sciences (KIMS) is one of the largest corporate healthcare groups operating in Andhra Pradesh and Telangana. KIMS has grown from a single 200-bed hospital at Nellore in 2000 to a multi-disciplinary healthcare service provider with 9 multi-specialty hospitals and over 3,000 beds today. KIMS focuses on offering quality healthcare services at affordable prices, regardless of the market, specialty or service type. It has successfully implemented affordable pricing model in all its hospitals across Tier 1 and Tier 2-3 markets. KIMS has consistently delivered strong operational and financial performance through robust patient volumes, cost efficiency and diversified revenue streams across medical specialties. A disciplined, low-leverage approach to acquisitions enables KIMS to maintain its affordable pricing model and expand its hospital network. KIMS is set to acquire a 51.07% equity stake in Sunshine Hospitals which will help it to consolidate its position as a leading provider of tertiary care services in its key markets and bring on board an orthopaedic surgical team led by Dr. AV Gurava Reddy. KIMS’s plan to add ~1,700 incremental beds over a span of 24-48 months provide further revenue visibility.

Outlook

We expect robust revenue growth in FY22, followed by acceleration in FY23, with contributions from Sunshine Hospitals and new beds. The KIMS stock currently trades at an attractive forward P/E of 21.8x FY24E EPS. Based on a target P/E multiple of 28.0x, we initiate coverage on KIMS with a BUY rating, based on a price target of ₹ 1,776 and an upside potential of 29%.

More Info

At 16:01 hrs Krishna Institute of Medical Sciences was quoting at Rs 1,381.05, down Rs 3.30, or 0.24 percent.

It has touched an intraday high of Rs 1,400.00 and an intraday low of Rs 1,327.75.

It was trading with volumes of 3,310 shares, compared to its thirty day average of 7,514 shares, a decrease of -55.95 percent.

In the previous trading session, the share closed down 0.09 percent or Rs 1.30 at Rs 1,384.35.

The share touched its 52-week high Rs 1,532.15 and 52-week low Rs 825.00 on 04 January, 2022 and 24 June, 2021, respectively.

Currently, it is trading 9.86 percent below its 52-week high and 67.4 percent above its 52-week low.

Market capitalisation stands at Rs 11,052.24 crore.

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