The research firm ICICI Securities believes earnings of apparel brands and retail companies under their coverage may surprise positively from Q3FY22E as the likely demand recovery may result in better than expected margin performance. Some of the costs savings achieved during pandemic may sustain and coupled with high operating leverage may lead to higher than pre-covid margins from Q3FY22E. Stocks like Trent, V-Mart and Aditya Birla Fashion and Retail are the preferred picks backed by their strong and consistent track record of execution.

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Prabhudas Lilladher's research report on Krishna Institute of Medical Sciences

KIMS’s robust cost control, low capital intensive set-up and value accretive acquisitions have ensured good profitability in past with EBITDA growth at 40% CAGR over FY18-22. Also, the recent acquisition of Sunshine is value accretive. This coupled with brownfield and greenfield expansion of +1500 beds over next 3-4 years will continue to aid growth momentum, in our view. We expect 18% EBITDA CAGR over FY22-24E, with best in class return ratios at 20%/30% RoE/RoCE.

Outlook

KIIMS Q1 operating performance was broadly in line and we see QoQ decline in occupancy as blip and should recover from Q2. Our FY23E and FY24E EBITDA stands cut by 4% and 3%. We maintain our ‘Buy’ rating with TP of Rs1,550/share, based on 20x FY24E EV/EBITDA. At CMP, stock is trading at valuations of 15.7x EV/EBITDA (adj for IND AS and partner’s stake) and 28x P/E on FY24E.

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Buy Krishna Institute of Medical Sciences; target of Rs 1550: Prabhudas Lilladher

Prabhudas Lilladher is bullish on Krishna Institute of Medical Sciences has recommended buy rating on the stock with a target price of Rs 1550 in its research report dated August 13, 2022.

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