Apollo Hospitals Exceeds Market Expectations with Stellar Q3 Performance
Apollo Hospitals delivered a powerful financial performance for the quarter ended December, surpassing analyst estimates with significant growth across its operations. The leading hospital chain reported a 17% year-on-year increase in revenue, reaching ₹6,477 crore, while profit after tax soared by 35% to ₹502 crore.
Strong Financial Metrics and Margin Expansion
Earnings before interest, taxes, depreciation, and amortization (EBITDA) grew impressively by 27% to ₹965 crore. The EBITDA margin expanded to 14.90%, up from 13.78% in the same period last year. These results comfortably exceeded Bloomberg-polled brokerage estimates, which had projected revenue of ₹6,326.5 crore and PAT of ₹489.6 crore.
CONGO Specialties Drive Exceptional Growth
Chief Executive Dr. Madhu Sasidhar attributed the outstanding performance to robust demand in high-specialty service lines, particularly the CONGO specialties. CONGO represents the hospital's cardiac, oncology, neurosciences, gastroenterology, and orthopaedics divisions, which have emerged as major growth drivers. Revenues from these specialties increased by 16% during the quarter.
Dr. Sasidhar emphasized that this growth is not a seasonal anomaly but results from strategic intentionality in recruitment, infrastructure investment, and enhanced marketing, sales, and digital activities. He noted that the December quarter is typically not seasonally strong for hospitals, making these results particularly noteworthy.
Multi-Disciplinary Care as Future Focus
The executive highlighted that high-complexity, multi-disciplinary care will remain a central focus and growth driver for Apollo Hospitals. This includes not only CONGO segments but also other critical, high-complexity care areas. Dr. Sasidhar explained that while these specialties are crucial, the hospital chain also operates numerous facilities across tier-II and tier-III markets, where there will be a significant mix of medical and surgical CONGO care alongside lower-complexity services.
Growth Primarily from Existing Infrastructure
Remarkably, this quarter's growth was achieved primarily through existing bed capacity, with incremental bed additions becoming operational late in the period. Dr. Sasidhar indicated that future quarters will benefit from additional beds coming online. During Q3, Apollo commissioned beds in Pune, with hospitals in Hyderabad, Kolkata, and Bengaluru scheduled for commissioning this quarter.
The hospital chain has previously announced ambitious expansion plans, including adding over 3,500 beds over the next five years with an investment of ₹5,400 crore.
Business Segment Performance Analysis
Hospital Services Business: This segment reported a 14% revenue growth to ₹3,183 crore, with PAT increasing by 21% to ₹422 crore.
Apollo Health and Lifestyle Ltd: The retail and diagnostics arm saw revenue rise by 20%, primarily driven by strong diagnostics performance. Primary care revenue and EBITDA grew by 20% and 19% year-on-year, respectively, due to enhanced corporate and partner outreach initiatives.
Digital Health and Pharmacy Distribution: This business segment reported a 20% revenue increase to ₹2,827 crore. The company added 487 new stores in the nine months ended December, while online pharmacy transactions grew by 31% during the same period.
The consistent performance across all business segments demonstrates Apollo Hospitals' diversified strength and strategic positioning in India's healthcare landscape. The emphasis on specialty care, particularly CONGO services, continues to yield substantial financial benefits while addressing growing healthcare needs in both urban and tier-II/III markets.
