Fortis Healthcare shares gain as CRISIL upgrades rating

NEW DELHI – In contrast to the decline in benchmark equity indices, shares of Fortis Healthcare gained 1.2 per cent in early trade on Monday after rating agency CRISIL upgraded its long term rating for the private hospital chain to 'AA- from 'A+' and placed rating on watch with developing implications. Further, the short-term rating has been upgraded to A1+, CRISIL said.

Shares of Fortis Healthcare rose to a high of Rs 244.30 as against Rs 241.35 at previous close on the National Stock Exchange.

Reports quoted CRISIL as saying that the rating upgrade is driven by improvement in consolidated operating performance, which should sustain over the medium term.

Profitability across hospitals has improved through various cost optimization measures while higher Covid-19 related testing and efforts to boost per lab utilisation have led to improvement in the diagnostics business, reports said, adding that a recovery in international patient flow would further benefit the operating performance of the company, going forward.

Fortis Healthcare’s reported debt reduced to Rs 1,001 crore as of December 31, 2021, from Rs 1,359 crore a year earlier, aided by improved operating performance, reports said.

The company maintains adequate liquidity, estimated at more than Rs 700 crore (including cash and equivalents and unutilised bank lines) as of January 31, 2022, reports said.

Though the third wave of the pandemic will have an impact on the operating performance of Fortis Healthcare in the fourth quarter of fiscal 2022, it is not expected to be significant; reports quoted CRISIL as saying.