Buy Aster DM Healthcare, target price Rs 234: Prabhudas Lilladher

Prabhudas Lilladher has buy call on Aster DM Healthcare with a target price of Rs 234. The current market price of Aster DM Healthcare is Rs 203.65. Time period given by analyst is one year when Aster DM Healthcare Ltd. price can reach defined target.

Aster DM Healthcare Ltd., incorporated in the year 2008, is a Mid Cap company (having a market cap of Rs 10162.59 Crore) operating in Hospitals & Allied Services sector.

Aster DM Healthcare Ltd. key Products/Revenue Segments include Hospital Services, Pharmaceuticals, Other Operating Revenue, Other Services, Consultancy Income for the year ending 31-Mar-2022.



Financials
For the quarter ended 30-06-2022, the company reported a Consolidated Total Income of Rs 2699.39 Crore, down -1.83 % from last quarter Total Income of Rs 2749.77 Crore and up 13.44 % from last year same quarter Total Income of Rs 2379.63 Crore. Company reported net profit after tax of Rs 80.16 Crore in latest quarter.



Investment Rationale
At current market price, the stock trades at an attractive valuation of 8x FY24E EV/EBITDA, which is at 25-50% discount to Indian peers. The brokerage believes such high discount reflects ASTERDM’s lower contribution from India region and higher capital outlay outside India. Also, such steep discount is unwarranted given stable profit trajectory and reduction in leverage. It maintains estimates and ‘Buy’ rating with TP of Rs234/share based on 15x FY24E EV/EBITDA to India business and 7x EV/EBITDA to GCC business.