Summary
Park Medi World Limited - Q3 FY 2026 Earnings Call Summary Thursday, January 29, 2026 12:00 PM
Event Participants
Executives 4 Dr. Ajit Gupta (Chairman), Abhishek Kapoor (Company Secretary), Mr. Rajesh Sharma (CFO), Dr. Sanjay Sharma (WTD & CEO), Mr. Sudesh Sharma (CSO & OSD Finance)
Analysts 5 Amit Agicha (HG Hawa and Co.), Mukesh (Aster Ventures), Nitin Agarwal (DAM Capital), Nirali Shah (Ashika Stock Services), Shreya Chatterjee (Ageless Capital), Tanay Bheda (Kotak Mutual Fund)
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Revenue | ₹410.0 crores | +18% YoY; Driven by steady patient volumes and ramp-up of newer/acquired hospitals. |
| EBITDA | ₹99.4 crores | +12% YoY (9M basis); Q3 margin at 24%, 9M margin at 26%. |
| Profit After Tax (PAT) | ₹52.8 crores | +40% YoY (9M basis); Supported by operating leverage and disciplined cost management. |
| ARPOB | ₹27,406 | +7.5% YoY; Driven by adoption of robotics and higher tertiary/quaternary case mix. |
| Occupancy | 65% | +300 bps YoY; Improved despite the addition of 250 beds in Bathinda. |
| ALOS | 6.34 days | -25 bps YoY; Reflected improved clinical processes and faster recovery times. |
| Debt | ₹15 crores | Term debt reduced from ₹425 crores pre-IPO; Management expects to be debt-free by Feb 2026. |
| Footfall (IPD/OPD) | 6.6 lakhs | +24% YoY (9M basis); Indicates strong demand in the North India cluster. |
Geographic & Segment Commentary
- Haryana & North India: The company remains the largest private chain in Haryana and second-largest in North India. It operates 14 hospitals with 3,250 beds, focusing on a “cluster-based” strategy to maintain clinical consistency and operational synergy across Haryana, Punjab, Delhi, and Rajasthan.
- Uttar Pradesh Expansion: Strategically identified as a high-growth territory with plans to reach 1,060 beds by FY28 via three pivots: Agra (West), Kanpur (Central), and Gorakhpur (East). The Agra acquisition (KPIMS) serves as the western anchor, targeting a captive population of 21 lakhs.
- Segment Mix (Payer): Government schemes account for 83% of the mix (93% of which is Central Government), while Cash/TPA accounts for 17%. Management expects the private insurance mix to reach 25% in the medium term as patients transition from affordable sections to private coverage.
Company-Specific & Strategic Commentary
- Technological Leadership: Deployed three 5th-generation da Vinci robots for cardiac, joint replacement, and organ transplant surgeries. These investments are credited with increasing ARPOB from ₹25,500 to ₹27,500 while maintaining the “affordability” pillar.
- Asset-Light/Low-Capex Growth: Maintained a low capex per bed of ₹34-35 lakhs by acquiring distressed assets and optimizing bed configurations (40% general wards, 30% ICU). The 2,010-bed expansion plan through FY28 is budgeted at ₹700 crores.
- Full-Time Doctor Model: Employs 1,200 full-time doctors with no visiting consultants, contributing to an industry-low consultant attrition rate of 18.9%. Clinical staff are rewarded based on patient satisfaction and outcomes rather than revenue volume.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Bed Capacity | 5,260 beds by FY28 | Adding 660 beds in Q4 FY26 (Agra & Panchkula), 500 in FY27, and 850 in FY28. |
| EBITDA Margin | 26% - 27% | Management targets sustaining these margins over a 3-10 year horizon. |
| PAT Margin | 15% - 17% | Expected to remain stable as new hospitals hit the 20% EBITDA margin mark by Year 2. |
| Revenue Increment | +7.5% (Conservative) | Anticipated impact from CGHS rate hikes (12-15% actual) to start reflecting in H2 FY27. |
Risks & Constraints
| Risk | Context |
|---|---|
| Receivable Cycle | High dependency on government payers (83%) leads to a receivable cycle of 4.5 months. Management is attempting to reduce this to 3.5-4 months through faceless portal improvements. |
| Integration Risk | Significant capacity expansion (660 beds in Q4 FY26 alone) requires rapid clinical hiring and training. Delays in ramping up occupancy to the 30% EBITDA breakeven mark could pressure short-term margins. |
| Disallowed Claims | While currently at 8-9% (below industry average), insurance claim rejections remain a structural risk in the healthcare delivery model. |
Q&A Highlights
CGHS Rate Hikes
- Question: What is the incremental revenue and EBITDA impact from the CGHS rate increase? (Tanay Bheda)
- Answer: The hike is ~12-15%, but management conservatively models only a 7.5% increment. Full impact is expected by H2 FY27 after it percolates through ECHS and state boards (Dr. Sanjay Sharma).
Agra Acquisition Strategy
- Question: How does the Agra acquisition fit the strategy, and what was the valuation? (Nirali Shah, Nitin Agarwal)
- Answer: Acquired for ₹245 crores (360 beds). It serves as a western pivot for UP. Although currently at 30% occupancy on 180 beds, Park will operationalize all 360 beds with full super-specialty services (Rajesh Sharma, Dr. Sanjay Sharma).
Receivables & Payer Mix
- Question: How do you manage the high receivable cycle associated with government schemes? (Shreya Chatterjee)
- Answer: 93% is Central Government (sovereign). The cycle is ~4.5 months (3 months processing + 45 days payment). This acts as a “moat” because competitors with higher cost structures cannot operate at Park’s ARPOB levels (Rajesh Sharma).
Doctor Attrition & Costs
- Question: Why did doctor costs increase 8% QoQ despite no bed additions in Q3? (Mukesh)
- Answer: Advance hiring and training for the 660 beds launching in Feb/March (Agra/Panchkula). Park uses a full-time model with an 18.9% attrition rate, rewarding outcomes over volume (Sudesh Sharma, Dr. Sanjay Sharma).
Key Takeaway
Park Medi World delivered a resilient Q3 FY26, with 9M revenue growing 17% YoY to ₹1,218.9 crores and PAT surging 40% to ₹1,96.8 crores. The company is successfully executing its “affordable tertiary care” model, characterized by an industry-leading low capex of ₹34 lakhs per bed and a heavy reliance on a full-time doctor workforce. Strategic focus remains on regional clustering, with a massive expansion into Uttar Pradesh expected to bring total capacity to 5,260 beds by FY28. While a 4.5-month receivable cycle remains a structural constraint due to the 83% government payer mix, management views this as a competitive moat. With the company set to be debt-free by February 2026 and major capacity additions in Agra and Panchkula imminent, Park is well-positioned to capitalize on the CGHS rate hikes and deepening healthcare penetration in Tier 2/3 North India.
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