Apollo Hospitals stock jumps 4% on stellar Q1 performance; Is it right time to buy?


Shares of the leading hospital chain Apollo Hospitals surged by 4 per cent, reaching a day’s high of 6,864.95 on the BSE, on Wednesday’s trading session. This increase followed the company’s announcement on Tuesday of a net profit of 305 crore for the first quarter ended June 2024, compared to 167 crore in the same period last year.

The company’s revenue from operations for the reporting period rose by 15 per cent year-on-year (YoY) to 5,086 crore, compared to 4,418 crore in the same quarter last year.

Revenue from healthcare services increased by 15 per cent year-over-year, reaching 2,637 crore. The segment’s EBITDA also saw a 15 per cent rise, amounting to 622 crore. Additionally, the segment’s Profit After Tax (PAT) grew by 24 per cent YoY, totaling 328 crore.

The diagnostics and retail health segment of the company also outperformed compared to the same period last year. Apollo Health and Lifestyle Ltd’s revenue increased by 15% year-on-year in the June quarter, while its losses reduced to 14.8 crore from 21.4 crore a year earlier.

The digital health and pharmacy distribution business achieved a positive EBITDA in Q1FY25, recording an operating profit of 22.5 crore, a significant improvement from the 56.6 crore loss in Q1FY24, driven by cost optimization and a 15% year-over-year revenue growth. However, the company still reported a net loss of 12.9 crore, an improvement from the 82.6 crore loss recorded in the same period last year.

Should you buy?

Brokerage firm JP Morgan has maintained ‘overweight’ rating to Apollo Hospitals stock, with a target price of 6,800. “Q1 results met expectations, with a notable increase in occupancy. While weak ARPOB growth, moderate GMV growth for Apollo 24/7, and margin declines were key negatives, the positives included strong revenue growth across segments and a significant improvement in occupancy,” the brokerage firm said in a note.

The stock has surged more than 41% in the past year. However, it has underperformed recently, with its price staying flat over the last six months.

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