Aster DM Healthcare Limited | Stock Market Updates

The shares of Aster DM Healthcare have delivered an impressive multibagger return of over 200% in the past three years.

Aster DM Healthcare Limited is one of the largest integrated private healthcare service providers operating in GCC (Gulf Cooperation Council) countries and an emerging player in India. The company’s shares are in the spotlight today due to a block deal.

While the identities of the buyers and sellers remain undisclosed at present, sources suggest that private equity firm Olympus is seeking to divest approximately 10% of its stake in Aster DM Healthcare through a block deal.

“Olympus Capital Asia Investments Limited currently holds around 18.96% stake in Aster DM Healthcare, of which it aims to sell 9.8%,” the sources added. The deal’s total transaction value amounted to approximately Rs 2,070 crore.

Following the block deal, the shares of Aster DM Healthcare are trading lower and fell by 7.24% today compared to yesterday’s closing price. As of writing this article, the company’s shares are trading at Rs 410.70 per share, around 5.94% down compared to yesterday’s closing of Rs 436.65 per share on the BSE. During the morning session, it hit intraday highs and lows of Rs 418.95 and Rs 405 respectively. The current market capitalisation of the company stands at Rs 20,515 crore.

Additionally, the company’s shares have delivered an impressive return of 73% in the past year and a remarkable multibagger return of around 208% in the past three years.

In terms of ownership, the Promoter holds 41.88%. The FIIs and DIIs hold 41% and 7.15% respectively.

Financial Performance

In the third quarter of FY24, Aster DM Healthcare reported revenues of Rs 3711 crore, reflecting a growth of 16.24% YoY compared to the same quarter in the previous year, when the revenue stood at Rs 3192 crore. The company posted an operating profit of Rs 556 crore for the quarter, in contrast to an operating profit of Rs 449 crore in the corresponding quarter of the previous year. Furthermore, the company reported a net profit of Rs 209 crore, compared to a net profit of Rs 159 crore in the same period last year. However, the company’s net profit has surged by around 31.40% YoY this quarter.

The company’s ROCE and ROE are 9.21% and 11% while the shares are trading at a PE of 56.3 times in the market.

Disclaimer: This post has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.

Aster DM Healthcare concludes separation of India and GCC businesses

Under the separation plan, a consortium of investors led by Fajr Capital has acquired a 65% stake in Aster GCC, with the Moopen family retaining a 35% stake alongside management and operational rights.

Separation of India and GCC businesses

Aster DM Healthcare and GCC has today announced the completion of the separation of its India and GCC businesses. Under the separation plan, a consortium of investors led by Fajr Capital, a sovereign backed private equity firm, has acquired a 65% stake in Aster GCC, with the Moopen family retaining a 35% stake alongside management and operational rights. In the Indian operations, the Moopen family continues to hold the 41.88% stake. The transaction has now concluded and pursuant to which Affinity Holdings Limited (a wholly subsidiary of the Company) has received a cash consideration of USD 907.6 million.

In November 2023, the Company obtained board approvals to separate its GCC and India businesses to establish two distinct regional healthcare champions that will benefit from the strategic and financial flexibility to meet the priorities of patients and focus on the growing demand in their respective markets. The separation plan was also approved by the company’s shareholders in January 2024. The transaction was subject to customary regulatory approvals, contractual approvals and closing conditions, all of which have been satisfied and concluded.

The company plans to add 1700 beds by FY27 through the organic route and will further look for expansion through the inorganic route as well to be among the top 3 hospital chains in India. The expansion plan will encompass a mix of brownfield and greenfield projects, encompassing the upcoming Aster Capital in Trivandrum, and Aster MIMS Kasargod and adding bed capacity to the existing hospitals. The Company will also be looking at potential markets such as Maharashtra and Uttar Pradesh. The capital allocation for this expansion is in the range of Rs 1000 crore.

The company intends to consider distributing 70-80% of the transaction proceeds as dividends to its shareholders in the range of Rs 110 to Rs 120 per share and anticipates distributing the dividend, post obtaining required approvals.

Dr. Azad Moopen will remain the Founder Chairman and while Ms. Alisha Moopen will remain a director on the board of the Company, she will also serve as the Managing Director and Group CEO of Aster GCC. The Indian entity will be led by Dr. Nitish Shetty as Chief Executive Officer, who will focus on the growth of the India business, aimed at creating value for its shareholders.

Company profile

Aster DM Healthcare Limited is one of the largest healthcare service providers operating in India with a strong presence across primary, secondary, tertiary, and quaternary healthcare through 19 hospitals, 13 clinics, 223 pharmacies, and 224 labs and patient experience centers across 5 States in India

Stock price movement

Today, the stock opened at Rs 411.45 and has touched a high and low of Rs 423.40 and Rs 407.20 respectively. The BSE group ‘A’ stock of face value Rs 10 has a 52-week high and low of Rs 495.15 and Rs 237.00, respectively. Last one week high and low of the scrip stood at Rs 423.40 and Rs 402.85 respectively. The current market cap of the company is Rs 20,879.65 crore.

The promoters holding in the company stood at 41.88%, while Institutions and Non-Institutions held 48.15% and 9.97% respectively.

Disclaimer: This post has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet, and is subject to changes. Please consult an expert before making related decisions.