Shares of Dr. Agarwal’s Health Care Ltd. remained in focus after Motilal Oswal reaffirmed its ‘Buy’ rating on the stock and set a target price of Rs 610 per share.
The target implies an upside potential of around 37 percent from the current market price of Rs 443.
The company has a market capitalisation of Rs 14,053 crore. The stock is trading about 22 percent below its 52-week high of Rs 568 and commands a P/E multiple of 106, compared with the industry average of 45.6.
Motilal Oswal remains positive
According to Motilal Oswal, growth will be supported by:
- Continued addition of new facilities
- Rising adoption of premium surgical procedures
- Expansion of the specialist doctor base
- Faster ramp-up of new centres
- Strong brand positioning
The brokerage expects the company to deliver:
- Revenue CAGR of 22 percent
- EBITDA CAGR of 23 percent
- PAT CAGR of 40 percent
over the FY26-FY28 period.
Expansion remains a key growth driver
Dr. Agarwal’s Health Care continued to expand its network during FY26.
The company added 57 centres during the year, taking the total number of facilities to 288.
Management plans to add another 60 facilities in FY27.
The company served nearly 3 million patients in FY26, representing a 24 percent year-on-year increase.
Surgical volumes continued to grow during the year.
The company performed 323,000 surgeries in FY26, up 14.5 percent from the previous year.
Growth in premium procedures remained strong.
Notably, Femto-assisted cataract surgeries increased 87 percent year-on-year.
The shift towards advanced treatments helped improve revenue per surgery.
Key operating metrics
- Surgeries performed: 323,000
- Growth in surgeries: 14.5 percent
- Growth in Femto-assisted cataract procedures: 87 percent
- Average revenue per surgery: Rs 42,900
- Increase in revenue per surgery: 8.5 percent
Profitability improves
The company reported strong growth across key financial parameters during FY26.
FY26 performance
- Revenue growth: 22 percent
- EBITDA growth: 26 percent
- Profit after tax growth: 60 percent
- EBITDA margin: 26-27 percent
Operating cash flow remained strong and amounted to nearly 91 percent of EBITDA, indicating healthy cash generation.
Strong doctor network supports operations
Dr. Agarwal’s Health Care had 968 doctors across its network at the end of FY26.
The company follows a hub-and-spoke model, which helps optimise specialist deployment and infrastructure usage.
South India remains its largest market.
Regional contribution
- Revenue contribution from South India: 61 percent
- Share of surgeries from South India: 64 percent
Expansion into other regions is expected to provide additional growth opportunities.
Outlook
The company’s growth outlook is supported by several factors.
These include:
- New centre additions
- Higher surgical volumes
- Greater adoption of premium procedures
- Same-store sales growth of 14 percent
With continued expansion and healthy margins, Dr. Agarwal’s Health Care is looking to strengthen its position in the organised eye-care market.
TL;DR:
Motilal Oswal has maintained a ‘Buy’ rating on Dr. Agarwal’s Health Care with a target price of Rs 610, implying a 37% upside. The brokerage expects growth to be driven by network expansion, higher patient volumes and rising adoption of premium procedures.
AI Summary:
- Motilal Oswal retained a ‘Buy’ rating on Dr. Agarwal’s Health Care.
- Target price of Rs 610 implies a 37% upside.
- The company plans to add 60 centres in FY27.
- Premium cataract surgeries grew 87% in FY26.
- Revenue, EBITDA and PAT CAGR are projected at 22%, 23% and 40%, respectively.
