Max Healthcare Earnings Conference Call Summary
Overview
• Date of call: August 2, 2024
• Transcript submitted on August 8, 2024
• Key executives present: Chairman Abhay Soi, CFO Yogesh Sareen
• Focus: Financial results for Q1 FY25 (quarter ending June 30, 2024)
Key Highlights
• New Hospital Launches
• Max Super Specialty Hospital in Dwarka launched with 303 beds.
• Plans for a new 250-bed hospital in Mohali.
• Recent acquisitions in Lucknow and Nagpur performing well.
• Financial Performance
• 18% year-on-year revenue growth.
• Operating EBITDA at Rs. 499 crore.
• Improved occupancy rates and Average Revenue Per Occupied Bed (ARPOB).
• Community Support
• Thousands of patients treated for free.
• Expansion Plans
• New facilities expected to be operational by FY26.
• Focus on enhancing clinical programs and adding specialties.
Q&A Session Insights
• Lucknow Sahara Unit Expansion
• Plans to add 140 beds and enhance clinical programs.
• Oncology identified as a key growth area.
• Dwarka Unit Performance
• Anticipated break-even within 6 to 9 months.
• Operational Model for Mohali Hospital
• Long-term lease agreement with developer covering construction costs.
• Tax Rate Concerns
• Increase due to losses in new entities; expected stabilization around 22%.
• Margin Contraction
• Attributed to a shift towards higher-end clinical services.
Challenges and Future Expectations
• Outpatient Growth Decline
• Significant drop attributed to visa disruptions affecting immigration-related consultations.
• Bed Share Mix
• Decrease in institutional bed share to 27%; expected to increase with new facility integration.
• International Patient Growth
• Growth outpacing other segments; temporary decline due to geopolitical issues.
• Insurance Dynamics
• Hospitals viewed as price takers; competitive advantage in EBITDA and ARPOB.
Conclusion
• Strategic focus on higher-value services and efficient management of new facilities.
• Expectations for future growth despite current challenges.

Max Healthcare Earnings Conference Call Summary (May 23, 2024)
Compliance and Overview
• Max Healthcare submitted earnings call transcript to NSE and BSE.
• Call discussed Q4 and fiscal year results ending March 31, 2024.
• Key executives included Chairman Abhay Soi and CFO Yogesh Sareen.
Financial Performance Highlights
• Q4 Results:
• Gross revenue: Rs. 1,890 crore (15% YoY increase).
• Operating EBITDA: Rs. 503 crore.
• PAT: Rs. 311 crore (slight dip).
• Average occupancy rate: 75%.
• Average revenue per occupied bed: 10% increase.
• Free cash flow: Rs. 412 crore.
• Fiscal Year Results:
• Network gross revenue: Rs. 7,215 crore (16% YoY growth).
• 14th consecutive quarter of growth.
Expansion and Market Strategy
• Expansion into Nagpur and Lucknow with 750 new beds.
• Emphasis on underserved markets in Uttar Pradesh (UP).
• Confidence in Lucknow as a hub for tertiary care.
Future Projections and Growth Drivers
• Expected EBITDA growth in FY26 from expansions in Mohali, Nanavati, and Max Saket.
• Plans to enhance international patient attraction.
• Anticipated improvements in payor and clinical mix.
Challenges and Concerns
• Visa issues affecting international patient segments, particularly in Iraq.
• Capacity constraints limiting occupancy growth.
• Competition concerns in UP markets.
Operational Insights
• Blended occupancy for Q4: ~74%.
• New facilities in Nagpur and Lucknow not yet fully impacting occupancy.
• Brownfield hospitals expected to break even quickly.
M&A and Financial Strategy
• Interest in markets with proven competitor viability for future acquisitions.
• Comfortable leverage target of up to 2.5x debt-to-EBITDA.
• Aim for a pre-tax ROCE of 20%-25% within 4-5 years post-acquisition.
Market Conditions and Bed Supply
• Delhi NCR region: largest player with 2,500 beds, but still underserved.
• Challenges in acquiring land for new hospitals in Mumbai.
• Recent additions at Shalimar Bagh hospital achieved EBITDA positivity quickly.
Legal Matters and Future Outlook
• Ongoing legal matters discussed without specifics.
• Strong operational performance with Rs. 1,336 crore in free cash flows.
• Optimism for significant growth in the coming years.

Compliance and Availability
• Max Healthcare submitted earnings call transcript to National Stock Exchange and BSE.
• Transcript available on the company's website.
Financial Performance Highlights
• Growth Metrics:
• 13th consecutive quarter of revenue and EBITDA growth (14% and 12% respectively).
• Operating EBITDA: Rs. 471 crore; Profit after tax: Rs. 338 crore (26% YoY increase).
• Free cash flow generated: Rs. 226 crore.
• Key Acquisitions:
• Acquired 550-bed Sahara Hospital in Lucknow.
• Performance Metrics:
• Slight dip in occupied bed days.
• 15% increase in average revenue per occupied bed (ARPOB).
• 25% growth in international business revenue.
Strategic Initiatives
• Medical Tourism:
• Government's "Heal in India" initiative contributing to 25% growth in international patient revenue.
• Oncology Focus:
• Advancements in surgical, medical, and radiation oncology, including CAR-T cell therapy.
Operational Updates
• Lucknow Hospital:
• Plans to renovate and expand capacity from 250 to 550 beds.
• Potential for significant future expansion (up to 3,500 beds).
• Dwarka Facility:
• Expected faster breakeven timeframe for EBITDA contributions.
Revenue Insights
• Institutional Revenue:
• Net positive impact of Rs. 50 crore annually.
• ARPOB growth driven by price increases and higher-end services.
• International Patients:
• 25% increase in volume; 5.8% share of total revenue.
Seasonal Trends and Challenges
• Seasonal Nature of Business:
• Q2 and Q4 are strongest quarters; Q1 and Q3 are weaker.
• Impact of seasonal diseases (e.g., dengue) on patient volumes.
• Outpatient Revenue Decline:
• Attributed to fewer dengue cases.
Future Outlook
• Expansion Strategy:
• Balanced approach to expansion; focus on both brownfield and new opportunities.
• Optimism for Q4:
• Management expressed confidence in growth and operational efficiency.

Max Healthcare Earnings Conference Call Summary (November 7, 2023)
Submission Details
• Transcript submitted to National Stock Exchange of India and BSE Limited on November 13, 2023.
• Available on the company's investor resources webpage.
• Key executives present: Chairman Abhay Soi and CFO Yogesh Sareen.
Financial Performance Highlights
• Q2 and Half-Year Results:
• 17% year-on-year increase in network revenue.
• 20% rise in EBITDA.
• 12 consecutive quarters of growth.
• Network gross revenue: INR 1,827 crore (25% growth in international business).
• Operating EBITDA: INR 497 crore (21% year-on-year increase).
• Profit after tax: INR 338 crore (26% improvement).
• Free cash flow: INR 436 crore.
Key Developments
• New hospital in Dwarka set to open.
• Max Shalimar Bagh facility revenue increased by 41%.
• Partnership with Intuitive Surgical to enhance surgical care in Southeast Asia.
Operational Metrics
• 3% increase in occupied bed days.
• 14% rise in outpatient volumes.
• 13% growth in average revenue per occupied bed (ARPOB).
Expansion and Capacity Management
• Ongoing expansion projects, with several on schedule.
• Network gross revenue for the first half: INR 3,546 crore (17% growth).
• 90% of expansion is brownfield, breakeven within 1-2 quarters; 10% greenfield, breakeven in 11-12 months.
Analyst Inquiries
• Institutional Patients:
• Share decreased from 29.7% to 25%.
• Focus on operational efficiencies and specialty growth, particularly in oncology.
• Discharge Rates and Seasonal Performance:
• Discharge rates increased by 7% year-over-year.
• Q4 is the strongest quarter, followed by Q2.
• Inorganic Growth Opportunities:
• Exploring 21 cities for potential expansion while maintaining fiscal discipline.
Future Outlook
• Plans for significant bed additions, primarily through brownfield projects.
• Confidence in long-term growth driven by increasing cash flow and development pipeline.
• Anticipated growth in international patient revenue, potentially exceeding 30%.
Robotic Surgeries and Staffing
• Increased adoption of robotic surgeries noted, with higher ARPOBs but lower percentage margins.
• Staffing for the Dwarka facility is on schedule, with an initial capacity of 164 beds.
Market Dynamics
• Significant long-term opportunity in India due to under-penetration of quality healthcare services.
• Favorable environment for price and ARPOB growth anticipated.
Conclusion
• Abhay Soi expressed optimism about future results and thanked participants for their engagement.

Meeting Overview
• Date: October 4, 2023
• Event: Submission of transcript for the 22nd AGM held on September 27, 2023
• Format: Video conferencing
• Key Participants: Dhiraj Aroraa (Company Secretary), Abhay Soi (Chairman), board of directors, and senior management
• Transcript availability: On the company's website
Chairman's Address Highlights
• Achievements:
• Launch of new expansion projects
• Introduction of "Max My Health" app
• Advancements in clinical excellence and technology
• Opening of a new oncology tower in Delhi
• Near completion of a hospital in Dwarka
• Commitments:
• Patient-centered care
• Environmental sustainability goals (water neutrality by FY25, increased renewable energy)
• Free treatment for over 363,000 patients
• Community health initiatives
• Digital Innovations:
• Implementation of a Data Lake for patient information
• Automated clinical data systems for improved patient safety and outcomes
• Focus Areas:
• Medical research and education partnerships
• Community relationships and sustainability
Future Plans
• Healthcare Sector Positioning:
• Collaborations with leading medical institutions for clinical research
• Increase bed capacity by over 2,800 through brownfield expansions
• Exploration of greenfield opportunities
• Strategic Initiatives:
• Pursue mergers and acquisitions
• Expand services through Max Lab and Max@Home
• Commitment to sustainability and ESG initiatives
AGM Agenda and Resolutions
• Resolutions:
• Adoption of audited financial statements for FY ending March 31, 2023
• Declaration of a final dividend of Re. 1 per equity share
• Re-appointment of Mr. Anil Kumar Bhatnagar as a director
• Special resolutions for director appointments and performance bonuses
• Shareholder Engagement:
• Positive feedback on governance and performance
• Inquiries about growth drivers, CSR initiatives, and support for lower-income groups
Shareholder Feedback
• Appreciation:
• Positive remarks on company performance and future prospects
• Key Questions Raised:
• Patient safety initiatives
• Potential acquisition of CVC pharmacy
• Board diversity and integrated reporting
• Inorganic growth strategy
• Competitors in the healthcare sector
Management Responses
• Growth Strategies:
• Sustaining growth and increasing dividends
• Promoting women’s employment and renewable energy initiatives
• Investment Opportunities:
• Emphasis on strong ROCE in the healthcare sector
• Commitment to maintaining a minimum dividend of Re. 1
• CSR Expenditures:
• INR 1.69 Crore spent in the last fiscal year
• 7% of hospital beds allocated for economically weaker patients
Conclusion
• The meeting concluded with voting procedures and appreciation for shareholder participation, highlighting a positive outlook and commitment to corporate governance.

Compliance and Key Highlights
• Submission: Transcript submitted to National Stock Exchange of India and BSE Limited.
• Growth: 11th consecutive quarter of revenue and EBITDA growth.
• Achievements:
• Added 44 beds through internal reconfiguration.
• Commissioned a 92-bed oncology block.
• Max Shalimar Bagh hospital reported 77% average occupancy.
Financial Performance (Q1)
• Occupancy: 3% year-on-year increase in Occupied Bed Days (OBDs), average occupancy rate of 74%.
• Admissions: Increased by 4%, institutional bed share decreased to 29.7%.
• Revenue:
• Average revenue per occupied bed (ARPOB) at Rs. 74,800 (up 13% YoY).
• Network gross revenue of Rs. 1,719 crore (17% increase YoY).
• International patient revenue grew by 31%.
• Digital revenue accounted for 21% of total revenue.
• EBITDA: Operating EBITDA at Rs. 436 crore (18% YoY growth).
• Profit: Profit after tax rose to Rs. 291 crore (27% increase).
• Cash Flow: Free cash flow from operations at Rs. 261 crore, net cash position of Rs. 957 crore.
• Community Care: Treated approximately 38,760 patients from economically weaker sections for free.
Strategic Discussions
• Cash Outflow: Expected cash outflow of around Rs. 900 crore, variable month-to-month.
• Occupancy Strategy: Not optimizing payor mix; accepting more institutional patients.
• Surgery Margins: Higher-end surgeries yield lower percentage margins but higher absolute profitability.
• Seasonal Trends: Q1 typically sees lower occupancy; demand remains steady across facilities.
Expansion and Growth Opportunities
• Tier II Cities: Open to entering cities with demonstrated viability; exploring 21 identified cities for future expansion.
• Inorganic Growth: Focus on achieving 20-25% return on capital employed (ROCE) rather than current acquisition prices.
• Project Timelines: Most projects on schedule for commissioning in Q4 FY'25 or Q1 FY'26.
Operational Metrics and Financial Health
• Employee Costs: Increase due to new beds and ICU facilities; typically rise by 6.5-7% annually.
• CAPEX: Routine CAPEX amounts to Rs. 170-180 crore annually; Rs. 70 crore spent in the current quarter.
• Debtor Days: Days Sales Outstanding (DSO) increased from 55 to 66 days due to accounts receivable buildup.
Performance Insights
• Shalimar Bagh Growth: Revenue and EBITDA growth reported at 37% and 43% year-on-year, respectively.
• Gross Debt: Rs. 641 crore gross debt; net cash of Rs. 1,681 crore.
• Oncology Segment: Increased revenues from expensive ORC drugs due to higher cancer incidence and health insurance coverage.
Conclusion
• Management expressed optimism for future growth and thanked participants, looking forward to the next quarter.

Earnings Call Submission
• Date: May 24, 2023
• Compliance with SEBI regulations
• Discussion of Q4 and fiscal year results ending March 31, 2023
Key Financial Highlights
• Significant increase in:
• EBITDA
• Free cash flow
• Profit after tax
• Year-on-year revenue growth of 26% in Q4
• Strong performance in:
• International patient revenue
• Digital services
• Announcement of first dividend and ongoing expansion projects
Management Vision and Strategy
• Abhay Soi's focus on growth opportunities in the hospital sector
• Redeployment of Rs. 1,281 crore in free cash flows for expansion
• Preference for a cluster approach for new hospital openings
• Openness to expanding into Tier-II and Tier-III cities
Financial Metrics and Performance
• Increase in Average Revenue Per Occupied Bed (ARPOB) from Rs. 50,300 (FY'20) to Rs. 67,400 (FY'23)
• Positive impact from:
• Upward revisions in PSU tariffs
• Increased international business
• Optimism about future growth driven by operational improvements
Capital Expenditure and Market Concerns
• Rs. 900 crore allocated for ongoing projects; Rs. 170 crore for routine CAPEX in FY24
• No observed new bed constructions in Delhi NCR
• Addressed concerns about potential bed oversupply
Regulatory and Market Dynamics
• Clarification on "Right to Health" mandates and emergency care compliance
• Confirmation of free bed provisions for the needy in trust hospitals
• Discussion on PSU tariff revisions and their impact on EBITDA
Growth Opportunities and Challenges
• Optimism about medical tourism growth in India
• Concerns about land scarcity for new hospital developments
• Long-term investment potential in the healthcare sector despite private equity involvement
Strategic Focus
• Pursuit of collaborations to mitigate construction risks
• Expansion of specialty services, particularly in oncology
• Confidence in enhancing service offerings and managing occupancy rates
Conclusion
• Acknowledgment of challenges in achieving a 15% institutional volume mix by March 2024
• Expression of gratitude to participants at the call

Financial Performance Highlights
• Revenue Growth: 13% year-on-year to Rs. 1,559 crore.
• Occupancy Rate: Increased to 77%.
• EBITDA: Record high of Rs. 419 crore.
• Net Cash Position: Rs. 372 crore.
• Digital Revenue & International Services: Significant growth reported.
Expansion Plans
• New Hospital Projects: On track for completion by FY25.
• M&A Opportunities: Open to value-accretive acquisitions, especially in new geographies.
Market Strategy
• Regional Focus: Cautious entry into Southern markets; prioritizing profitability.
• Transplant Operations: Growth in liver, kidney, and bone marrow transplants, but limited impact on EBITDA.
Operational Insights
• Bed Addition: Over 100 beds expected through internal reconfiguration by FY '24.
• Operating Costs: Majority of capital expenditure on brownfield expansions for quicker breakeven.
International Patient Segment
• Revenue Metrics: ARPOB for international patients is 1.5 times that of domestic patients.
• Marketing Strategies: Partnerships with international medical tourism companies to attract patients.
Seasonality and Occupancy
• Occupancy Trends: Q2 typically sees higher rates; Q3 is weaker due to festive holidays.
• Future Growth: Adding over 500 beds to manage occupancy and drive growth.
Financial Metrics and Projections
• Breakeven Timelines: Shift from two years to 12-15 months for greenfield projects.
• ARPOB Drivers: Favorable clinical and payor mix contributing to higher ARPOB.
Brand and Competitive Position
• Brand Strength: Occupancy driven by brand reputation rather than ARPOB.
• Public Hospital Competition: Downplayed threat due to quality differences.
Digital Initiatives
• App-Based Model: Enhances patient-doctor interactions and hospital services without significant cash burn.
• Average Length of Stay (ALOS): Higher ALOS linked to complex cases, impacting revenue positively.
Commitment to Growth
• Fiscal Discipline: Emphasis on prudent leverage ratio and execution.
• Future Opportunities: Willingness to explore specialized healthcare sectors as they arise.

Max Healthcare Earnings Call Summary (February 3, 2023)
Submission Details
• Date of Submission: February 8, 2023
• Recipient: National Stock Exchange of India and BSE Limited
• Availability: Transcript on investor relations website
Financial Performance Highlights
• Occupancy Rate: 77%
• Network Gross Revenue: Rs. 1,559 crore (13% increase YoY)
• EBITDA: Highest-ever at Rs. 419 crore
• Net Cash Position: Rs. 372 crore
• Community Support Initiatives: Ongoing
Expansion and Growth Strategy
• New Hospital Projects: Several underway
• Inorganic Growth: Exploring opportunities with a conservative debt approach
• Regional Expansion: Open to entering new markets based on competitor viability
Transplant Operations
• Growth Projections: Liver, kidney, and bone marrow transplants contribute 5%-6% to total operations
• Current Monthly Transplants:
• Liver: 40-45
• Kidney: 60-65
• Bone Marrow: 25-30
Bed Additions and Operating Costs
• New Beds: Over 100 beds through internal reconfiguration expected by Q1/Q2 FY '24
• Capital Expenditures: Focus on brownfield expansions for quicker breakeven
International Patient Segment
• Contribution: Average 11-12% in NCR hospitals
• Strategies: Partnerships with medical tourism companies and health ministries
• Revenue Generation: Higher ARPOB and EBITDA per bed compared to domestic patients
Average Revenue and Occupancy
• ARPOB: Expected to maintain around 80% occupancy with new bed additions
• Payor Mix: Targeting reduction to 15% over the next 4-5 quarters
Competition and Market Position
• Public Sector Competition: Private sector remains resilient despite public hospitals' idle capacities
• Talent Source: Public hospitals serve as a source for experienced doctors transitioning to private roles
Margin Outlook
• New Bed Additions: Brownfield expansions expected to enhance margins
• M&A Opportunities: Open to pursuing acquisitions that are accretive to return on capital
Digital Initiatives
• App Launch: 'Max MyHealth' set for formal launch after 90,000 downloads
• Patient-Doctor Interaction: Emphasis on the app as a platform without significant cash burn
Average Length of Stay (ALOS)
• Current ALOS: 4.2 days, correlating with higher ARPOB due to critical care treatments
Conclusion
• Focus: Execution and fiscal discipline with a prudent leverage ratio for growth.