Artemis Medicare Services Ltd Q4 FY2026 Concall Summary

Key Takeaways

• Strong quarter, growth accelerating: Revenue grew 16.4% YoY in Q4, with PAT up 32.1% YoY, driven by higher patient volumes in high-margin specialties and a 26.9% jump in international patients for the full year.
• Raipur is the next growth engine, but a near-term margin drag: The 300-bed hospital opens in Q1 FY27 with an expected INR 18–20 crores loss in its first year, shaving 1%–1.5% off consolidated EBITDA margins before breaking even in 18–20 months.
• Gurgaon flagship is firing on all cylinders: Occupancy hit 64.6% with a clear path to 70% by Q2, ARPOB is the highest in NCR, and incremental revenue is expected to flow through to EBITDA at a 30% rate.
• A capital raise of up to INR 700 crores is imminent to fund new brownfield and greenfield projects, with at least one asset expected to be finalized in the next four to six weeks.
• What to watch next quarter: The Raipur hospital's operational launch and initial occupancy ramp, the finalization and shareholder approval of the new project pipeline, and whether Gurgaon occupancy hits the 70% target.

Financial Performance

• Revenue growth: FY26 revenue grew 15.4%, with Q4 accelerating to 16.4% YoY, driven by strong performance in cardiology, oncology, and orthopaedics, an improved payer mix, and a surge in high-complexity procedures.
• Profitability: Q4 EBITDA margin reached 21.3%, while PAT grew 32.1% YoY, reflecting efficient scaling and financial discipline.
• ARPOB momentum: ARPOB increased 7.3% YoY, driven by an enhanced case mix and higher-paying patients, a trend management expects to continue at 7%–8% annually.
• Cash flow: Cash flow from operations was around 60% of EBITDA for the year, with free cash flow at approximately 40% after capex, an improvement over the prior year with no one-off items.
• Gurgaon margin drivers: Three factors underpin the flagship's profitability: a high volume of high-end domestic and international patients, a 1.5%–2% reduction in consumption costs with further efficiencies planned, and the spreading of corporate overheads as new facilities come online.
• Pricing strategy: The company does not use pricing to drive business, focusing instead on case mix and operational efficiency; it positions itself as moderately priced, comparable to Medanta but cheaper than Fortis or Max in the region.

Devlina Chakravarty: "We are in NCR and we have the highest ARPOB in NCR. We are higher than even Delhi. ... in Gurgaon we beat even the South Delhi ARPOB because of our mix of patients, our high-end surgeries and our efficiencies of the bed turnaround time."

Raipur Hospital: Thesis, Launch & Financial Impact

• Market opportunity: Raipur is attracting every major tertiary and quaternary private player; management predicts it will become a "mini-Lucknow." Currently, 60% of patients from Chhattisgarh travel to Mumbai and Delhi for treatment, and no single hospital in the city has the right infrastructure, equipment, and doctors.
• Competitive advantage: The hospital's land and building partners are the two most reputed doctors in Raipur, giving it immediate patient recognition. It will be the first hospital in the city with a PET CT scan, and will offer radiotherapy, robotics, and transplants, capturing the outbound patient flow.
• Operational readiness: All resource heads of departments are in place with joining letters rolled out from the first week of June; nurses are hired; doctors are trained in robotics and high-end cardiac interventions. Raipur has its own medical college, postgraduate college, and three nursing colleges, ensuring no manpower shortage.
• Ramp-up timeline: The first 150 beds go live in Q1 FY27, with an additional 50 beds within 3–4 months, and all 300 beds operational within two quarters. It takes three months for TPA empanelment and six months for government schemes, with transplant licenses following a similar timeline.
• Margin dynamics: Standalone EBITDA margins in smaller towns are structurally higher at 20%–25% due to lower costs for food, housekeeping, doctors, nurses, and paramedics. Starting ARPOB is expected at INR 33,000–35,000 plus, rising as high-end procedures begin.
• Consolidated impact: The INR 18–20 crores of expected first-year losses will drag consolidated EBITDA margins by 1%–1.5%, but management intends to offset this with strong EBITDA growth from the Gurgaon facility. Post break-even within 18–20 months, Raipur will become EBITDA-accretive.

Devlina Chakravarty: "I predict Raipur to become something a mini-Lucknow going ahead."

Gurgaon Flagship: Capacity, Occupancy & Growth

• Occupancy trajectory: Despite continuous bed additions over the last two years keeping the occupancy denominator rising, management is confident of reaching 70% by Q2 FY27, with a sustained endeavour to operate in the 70%–75% range.
• Bed expansion trigger: Once 70% occupancy is sustained for a quarter, the company will open 50 more beds, followed by another 50. A decision on whether to use the 100-bed FAR addition from the Platinum Green Building certification or pursue an alternative brownfield/greenfield project is expected in the next few weeks.
• Revenue growth: Gurgaon is projected to grow revenue at 15%–17% year-on-year, with at least 30% of incremental revenue flowing through to EBITDA.
• Capability: The hospital is the biggest in Gurgaon by referrals, with a full suite of services from heart-lung and liver transplants to bone marrow, neurosurgery, neuro intervention, and cyberknife, reflected in patient growth and ARPOBs.

Devlina Chakravarty: "There is no deficiency in this hospital and that is why this hospital is the biggest hospital in terms of Gurgaon referrals."

International Business & Patient Mix

• International patient growth: Revenue from international patients grew 26.9% in FY26 despite the West Asia war, with high demand from Africa and the CIS reflecting growing trust in clinical capabilities.
• Revenue mix target: Management aims to maintain international patients at 30%–31% of total revenue, irrespective of geography or top-line movement.
• Recovery from March dip: A domestic surge in high-end surgeries offset an international dip in March; as of May 2026, international volumes had recovered almost 90% and are back on track.
• Geographic expansion: The company is looking at Canada and Nordic countries for high-end treatments, adding a couple of new countries each year. A second hospital in Mauritius started operations in April.
• Case mix improvement: A surge in neurosurgeries, cardiac surgeries, onco surgeries, and transplants from both domestic and international patients drove the quarter's performance.

Devlina Chakravarty: "Our endeavour would be to remain at the same 30%, 31% of revenue coming from international patients, irrespective of where we are and how our top line moves."

Expansion Pipeline & Capital Raise

• Board approval: The board has approved a fundraise of up to INR 700 crores, which will go to shareholders for approval once specific assets are finalized. The capital is earmarked exclusively for new projects, which could be one or two in number.
• Project pipeline: The pipeline includes both brownfield and greenfield projects, with management aiming to finalize at least one in the next four to six weeks.
• VIMHANS (South Delhi): A 650-bed facility expected to be commissioned in FY29. Advance payments for building milestones have started gradually, with the bulk of capex for interiors and equipment coming after FY27, starting mid-FY28.
• Bed expansion target: The company aims to grow from the current 800 beds to 2,000 beds by 2029.
• Return thresholds: Any new capital deployed targets a ROCE of 16%–18% over a three-to-five-year timeframe, with a payback period within five to six years.
• FY27 capex: Expected at close to INR 100 crores, comprising replacement capex for Gurgaon and the remaining fit-out for Raipur.

Devlina Chakravarty: "So this capital raise is only going to fund our new projects which could be one or which could be two."

Operational Initiatives & Industry Context

• AI and data analytics: AI-assisted triage systems have been implemented across hospitals, reducing wait times and improving patient flow. Data analytics is being expanded to optimize patient pathways and support clinical decision-making.
• Sustainability: The company received Platinum Green Building certification in FY26, entitling it to a 15% increase in FAR at no additional cost, enabling 100 additional beds at the Gurugram facility. Energy-efficient systems and waste reduction programs have been implemented.
• Clinical partnerships: A collaboration with KIMS Hyderabad for advanced heart and lung transplants was established, and India's first private geriatrics and longevity department was launched.
• Payer mix strategy: Management actively keeps cash, TPA, and international business higher than government-empanelled business. While government rates have been revised upwards, the company cherry-picks investigations and treatments close to rack rates, managing government volumes only to ensure no bed stays empty as capacity increases.
• Regulatory engagement: The company is involved in GIC Council and IRDAI working groups on hospital categorization for transparent pricing and ethical practices between insurers and hospitals, which management believes will be a "win-win" for both sides when implemented.
• Oncology mix dip: A transient dip in oncology case mix was caused by TPA pushback on immunotherapy and a temporary halt on chemotherapy for government-empanelled patients due to an unfavourable circular; both issues have been resolved and chemotherapy has restarted.

Devlina Chakravarty: "We definitely don't want the government business to come up and it's not coming up, but we keep moving around in a manner so that no bed stays empty as we increase capacity."

Guidance & Commitments

Key Metrics