9M23 results: In-line with Improvement margin
Key Takeaways :
▪️In 9M23, HEAL booked a revenue of IDR4.2tn, or grew by 16.1% YoY ( vs IDR3.6tn 9M22), implying 75.6%/74.2% of MNCS/cons. This was driven by an increase in the price of healthcare, coupled with an increase in bed occupancy rate to 71% (vs 60% in 9M22) and a higher Average Length of Stay (ALOS) of 2.8 days. Both the number of inpatient days and outpatient visits experienced an increase in 9M23.
▪️HEAL posted a net profit of IDR348.8bn, or grew by 42.1% YoY in 9M23, implying 78.7%/76.4% of FY23E MNCS/Cons target, primarily due to an increase in efficiency which delivered margin expansion as well as the increase of HEAL ownership in the subsidiaries.
▪️In 3Q23 HEAL opened a new branch in Ciawi, adding up to a total of 46 branches and 6.6k beds. There are plans to add another branch in Aceh, scheduled to open in 4Q23, making it a total of 47 branches by the end of the fiscal year. Looking ahead to FY24F, HEAL targets branch additions in several areas, including: 1) Pasuruan; 2) Madiun; and 3) PIK 2.
▪️HEAL also plans to build a hospital in IKN with a capacity of >100 beds, targeted for operational commencement in FY24F, the development of this hospital is a collaborative effort between HEAL and PT Bina Karya (Persero).
▪️We maintain BUY for HEAL with a higher TP : IDR1,720, which implies PE/PBV 58.1x/6.7x on FY23E and 44.9x/6.0x in FY24F.
MNCS Research
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