Nomura, a research firm, has revised its price target for Fortis Healthcare from Rs 700 to Rs 820, while maintaining its “buy” rating. The firm attributes this increase to the company’s strong growth prospects, driven by its existing infrastructure and strategic expansions. According to Nomura, the Indian hospital sector has seen significant re-rating over the past five years, resulting in rich valuations. However, Fortis Healthcare is expected to trade in line with or at a premium to its peers due to its robust growth prospects.
The hospital segment of Fortis Healthcare has shown impressive growth, with revenue increasing by 14.8% in fiscal 2025, driven by higher occupancy and a 9% increase in average revenue per occupied bed. Nomura expects the hospital segment’s EBITDA margin to expand to mid-to-high 20s in the medium term. The firm also notes that while the diagnostics segment has underperformed due to a change in brand name, it expects a gradual improvement in growth and EBITDA margin over time.
Nomura is bullish on Fortis Healthcare’s outlook, citing its extensive network of hospitals and collection centers across the country. The firm believes that the company can effectively leverage its network to improve its financial performance over time. With its strong growth prospects and existing infrastructure, Fortis Healthcare is well-positioned to close the gap with its peers and achieve higher valuations. Overall, Nomura’s revised price target and “buy” rating indicate a positive outlook for the company’s future performance.
The brokerage firm’s analysis highlights the potential for Fortis Healthcare to improve its financial performance, driven by its hospital segment’s growth and the expected recovery of its diagnostics segment. With its large and geographically widespread network, the company is well-positioned to capitalize on the growing demand for healthcare services in India. As a result, investors may consider Fortis Healthcare as a promising investment opportunity, driven by its strong growth prospects and improving financial performance.