Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
Aster DM Healthcare Limited (NSE: ASTERDM) Q4 2026 Earnings Call dated May. 01, 2026
Corporate Participants:
Puneet Maheshwari — Investor Relations
Alisha Moopen — Managing Director & Group Chief Executive Officer
Varun Khanna — Group Managing Director, Quality Care India Limited
Ramesh Kumar — Chief Operating Officer
Sunil Kumar — Chief Financial Officer
Analysts:
Tausif Shaikh — Analyst
Unidentified Participant
Unidentified Participant
Unidentified Participant
Unidentified Participant
Unidentified Participant
Unidentified Participant
Presentation:
Puneet Maheshwari — Investor Relations
Of astadium healthcare, namely Ms. Alicia Mopin, Deputy Managing Director, Mr. T.J. Wilson, Non Executive Director Mr. Ramesh Kumar, Chief Operating Officer, Mr. Sunil Kumar, Chief Financial Officer and Mr. Hitesh Dadda, Chief Investor Relations and MND Officer. We are also delighted to have Mr. Varun Khanna Group MD of Quality Care. Mr. Khanna is here solely in the capacity of a representative of Quality Care to give insights into the business and future plans of Quality Care, the entity which is in business the process to get merged with Astadium Healthcare.
It is to be noted that merger is subject to further regulatory approvals. All external attendees will be in listen only mode for the duration of the entire call. We’ll also we will start the call with the opening remarks by management followed by an interactive Q and A session. Certain forward looking statements in this meeting involve risks and uncertainties. Astra DM assumes no responsibility for actions based on these statements and undertakes no obligation to update them for further events. With this I will now request Ms.
Alicia Mopin to start with the opening remarks. Over to you Ms. Alicia.
Alisha Moopen — Managing Director & Group Chief Executive Officer
Thank you Puneet. Good morning everyone and thank you for joining us despite being Labor Day. As we move closer to completing the proposed merger with Quality Care, I would like to thank our shareholders for their continued confidence and support in approving the scheme. With this milestone behind us, the transaction now awaits final approval from the NCLT even ahead of the formal completion. The Combined Proforma in Performance provides a very useful view of the potential scale and the operating profile of the two organizations together.
It highlights how the complementary footprints, aligned clinical philosophies and the disciplined execution can translate into operating leverage and capital efficiency over time, providing visibility into the longer term earnings potential of the combined platform over the coming years. With that context, I will begin with the combined performer performance of Aster and Quality Care before moving on to Aster’s results. Turning to the performer performance, the combined view indicates a very steady and broad based trajectory so supported by very strong patient volumes, improving case mix, efficient cost management and a continued focus on clinical excellence.
What is particularly encouraging is how these factors when viewed together point to the potential for both scale and as well as improving the quality of earnings. So, coming to the quarter’s performance on a combined performer basis, the revenues have grown 18% year on year to 2,361 crores for the quarter, supported by a 12% increase in total patient volumes and an 8% improvement in ARPP IP. More importantly, as the benefits of scale and mix begin to play out, operating EBITDA has outpaced the revenue growth increasing by 25% to 517 crores.
This operating leverage translated into margins of 21.9% and a ROCE improvement of 293 basis points to 21.1% reinforcing the underlying strength of the model now coming to the full year. This interplay between scale mix and profitability becomes even more evident when we look at the full year performance for FY26. The combined platform has delivered revenue of 9,273 crores, growing 14% year on year with growth supported by a balanced increase both inpatient volumes as well as ARPP IP. The improvement in ARPP IP was underpinned by a 200 basis points in our Congo mix expansion which now stands at 55% along with a very healthy payer mix of cash and insurance at 83%.
As a result of this, our earnings continue to outpace our revenue with operating ebitda growing at 21% to 2013 crores and margins expanded by 116 basis points now to 21.7. Importantly, this performance reflects sustained momentum rather than a one year outcome. Over the past few three years the combined entity has delivered a revenue CAGR of 14.5% and an operating EBITDA CAGR of nearly 20%. This has been achieved even as we have continued to add capacity and manage inherent business seasonality reflecting a very well aligned and consistently executed operating philosophy.
Now coming to capacity Expansion to support this momentum, our capacity expansion has remained very disciplined and closely aligned with long term demand. Over the past year we have added 373 beds taking the combined capacity to 10,620 beds across 28 cities. Our pipeline includes 4,445 additional beds which will take our total capacity beyond 15,000 beds through a balanced mix of Greenfield and Brownfield expansion. This calibrated approach ensures that scale is built with precision, optimizing capital efficiency as well as supporting long term shareholder returns while strengthening our position as a leading Pan India Healthcare platform.
Coming to the Update on the Merger against this backdrop, the progress on the merger with Quality Care marks a very very important strategic milestone. During the quarter the merger received overwhelming approval from shareholders and creditors with 96.7% of shareholder vote cast in favor, reflecting strong alignment and confidence in the strategic direction from a regulatory point and standpoint. The transaction has progressed through all key stages including the receipt of the CCI approval and no objection letters from the NSE and BSE with no adverse observation.
The merger application was subsequently filed with the NCLT on December 11, 2025, with the shareholder and the creditor approvals also now in place. The matter is currently before the NCLT for the final approval. The next hearing is expected in May and upon receipt of the order the merger will become effective. Based on current timelines, we expect the process to to be completed within this quarter. Overall, the combined profoma performance along with the progress on the merger reinforces a consistent message that we’re not only scaling the platform but we are doing so in a way that enhances the mix, drives the operating leverage and improves capital efficiency in a very sustainable manner.
Now turning towards Aster’s performance for the final quarter of the year, despite macro headwinds, we delivered strong double digit growth across our core hospitals, clinics and lab businesses driven by robust patient volumes and the continued shift towards higher acuity care. The combination of volume growth and improving case mix remained the key driver of performance during the quarter. Revenue from operations stood at 1,182 crores reflecting an 18% year on year increase. This growth was supported by a 15% increase in total patient volumes, a 9% improvement in ARPP IP and the contributions from the recently operationalized Kasargod Hospital.
Importantly, the growth was not just volume led but also a mix driven with a higher share of specialized tertiary care, particularly in DBS and robotic procedures which saw a very meaningful increase during the quarter. This shift in case mix is also very evident at a specialty level. If you look at cardiology revenues, Those grew by 25% year on year with contribution increasing to 15% in Q4FY26 from 14% last year, while oncology revenues have grown 23% contributing to 11% of the overall mix. Together these segments continue to anchor the transition towards higher equity higher value care.
Alongside this, the medical value travel segment maintained strong momentum growing 41% year on year on the back of increased international patient footfall. Within Kerala, Mvt revenues grew 51% with stronger inflows from Maldives helping offset macro related softness from the Middle east, demonstrating the resilience and diversification of of the platform in our ancillary businesses, the labs continue to scale steadily with revenues increasing 18% year on year. As this growth and mix improvement flows through operating leverage is becoming increasingly more visible in our financials, operating EBITDA for the quarter stood at 244 crores, growing 26% year on year with margins at 20.7% to.
Despite the addition of the new capacity, core hospitals and clinics delivered particularly strong performance with operating ebitda growing at 32% and margins at 23.1% which reflects very steady execution across all our mature assets. Normalized pat grew by 32% year on year in Q4FY26 with margins up by 120 basis points. While the Kasakot facility remains in its initial ramp up phase, the underlying performance of the core network continues to demonstrate very strong operating leverage. Excluding Kasar Kot revenue and EBITDA grew 17% and 31% year on year respectively with margins expanding by 239 basis points to 21.7%.
Within core hospitals and clinics excluding Kasar code, operating EBITDA grew 36% with margins improving to 24.3% reflecting a 345 basis point expansion. Coming to some of the non core business performance, this has also been encouraging with improvement also visible in all these ancillary businesses. The collab segment saw a sharp increase in profitability with operating EBITDA growing 181% and margins expanding to 14.7% from 6.2% last year. Coming to the cluster Wise performance highlights across clusters, the same operating philosophy continues to play out with each region at a different stage of maturity.
Kerala continues to anchor stability and profitability despite a temporary and modest impact from the nurses strike. Inpatient volumes grew 11% year on year indicating sustained demand. Excluding Kasar code revenues grew nearly 18% year on year while operating EBITDA margins remained strong at 25.6% supported by cost efficiencies and operating leverage. Kerala continues to serve as a core earnings and cash generation pillar supporting investments across other regions. In the Karnataka and Maharashtra cluster operating performance continued to improve with revenue growing 11% year on year.
This was driven by a strong increase in ARPP IP supported by a strategic shift towards higher value procedures in cardiology and neurosciences and the de empanelment of low yielding schemes. At Astar Aadar operating EBITDA grew 25% with margins expanding by 270 basis points reflecting the combined impact of revenue growth, operating leverage and disciplined cost management. The Andhra and Telangana cluster delivered strong performance with revenues growing 30% year on year driven by both high volumes and improved ARPP ip.
Operating EBITDA more than doubled during the quarter with margins expanding significantly by 700 basis points to 18.3% highlighting the sharp operating leverage in this cluster. Moving to CAPEX and expansion, our growth strategy continues to balance near term operating performance with long term capacity creation anchored in disciplined expansion and return driven capital deployment. Over the past year we added 290 beds taking Aster’s total capacity to 5,449 beds as of 31st March 2026 and expanding our India network to 20 hospitals including Kasarkot.
This expansion has been both measured and demand led, ensuring that capacity addition translates to sustainable growth. As part of this roadmap, we launched 159 beds at Block D in Astor Whitefield in April 2026, a dedicated women and childcare facility that strengthens our specialized capabilities in Bengaluru and and addresses a growing demand segment segment. In the same month we also operationalized 75 beds at Ramesh on goal, further augmenting our presence in the region. Looking ahead, we plan to add nearly 2500 beds over the coming years through a balanced mix of greenfield and brownfield expansion which will take our total capacity to over 8,150 beds.
This includes planned Roundfield expansion of 150 beds in Mims Calicut as well as 130 beds in Mims Kannur. Importantly, our expansion pipeline remains phased and closely aligned with demand visibility, ensuring that growth is delivered with capital efficiency as well as supporting long term returns. Beyond our operational performance, this quarter also brought along strong validation of our clinical and leadership excellence through several prestigious global and national recognition. At an institutional level, our hospitals continue to be recognized across leading platforms.
In the Newsweek World’s Best Hospital Rankings 2026, our facilities secured prominent positions in India with Aster CMY Hospital ranked number 12 and Asta Med City ranked number 28. This was further complemented by strong national recognition in the Times of India all India Rankings 2026 where Asta Med ASA CMY were ranked 2 and 5th respectively while Aston MIMS secured the 9th position at the leadership level. During the year, Dr. Azad Mulpin recognized recognition on global platforms having been featured among the top five Forbes Middle east sustainability leaders 2025 and in the 100 NRI 2026 by entrepreneur Middle East.
This was further reinforced at the national level by where he was honored as a legend in the healthcare industry at the Fickey Heal 2025 to conclude this quarter reflects the strength of a well defined and consistently executed model with scale is driving improvements in case mix, operating leverage and ultimately capital efficiency. The combined profoma performance reinforces the strategic merit of our merger with quality care, demonstrating that the benefits of scale and disciplined execution are already translating into stronger and more sustainable earnings.
As we move through this final stage of regulatory approval, our focus remains firmly on execution excellence, capital efficiency and attracting high quality medical talent as we continue to build clinically superior scalable platform positioned to deliver sustainable long term value for all stakeholders. I will now invite Mr. Varun Khanna to take you through the performance highlights of QSil. Thank you,
Varun Khanna — Group Managing Director, Quality Care India Limited
Thank you Alicia Good morning and thank you for joining us today. I’m actually pleased to report that this quarter is yet another testament to the power of disciplined strategic execution and operational focus across Quality Care India limited. Our unwavering commitment to placing the patient at the center of of every initiative and our relentless focus on clinical outcomes has once again translated into strong business performance. This quarter we’re proud to report a double digit volume growth across the company with several of our key markets delivering even stronger results.
This reflects a consistent pattern of doing things right in the right way. Beyond volumes, our strategic priorities continue to gain meaningful traction. We are making deliberate and measurable progress on enhancing clinical complexity, positioning QCIL as the destination of choice for advanced and high acuity care. Our work on Congo T is progressing well and we are seeing the early fruits of that focus reflected in our operational metrics. Kim’s health strengthened its position in transplants. Performing the first heart transplant in Q4FY26, Kjara installed a cardiac laser which is the first of its kind in the QCL system.
Our pair mix continues to be extremely key for us and the team’s disciplined execution here continues to yield results quarter on quarter. This year we witnessed the coming together of a team and the power of our people. People who are accountable have the ability to motivate teams and lead with purpose. The team at QCR has come together in a cohesive way and a very meaningful one and delivered industry leading growth in FY26 while simultaneously working towards a merger that will create value for all of us.
As a team. We are excited for the journey ahead of us and are geared up towards a robust performance in the coming year as well. So let’s get to the financial performance. Q4FY26 witnessed a strong growth. Overall revenue growth by 18% year on year to 1178 crores. EBITDA grew 23% year on year to 272 crores. The EBITDA margin expanded 103bps yoy to 23.1%. Revenue growth was driven by an increase in IP and op volumes. QCRL treated and discharged 10% more patients in Q4FY26 over the same period last year serving 62,500 in patients.
Op footfalls grew 9% to 8.8 lakh consumers patients in that period. ARPP grew 7.4% to INR 135,000. Our efforts to strengthen clinical offerings and clinical teams has resulted in 97bps increase in Congo tea revenue which now forms 58% of the total revenue. Congo tea revenue grew 20% in Q4FY26 over Q4FY25. Pear mix moved favorably to 79% from cash insurance up 98bps. EBITDA growth represents our concerted efforts in synergy realization across the network including procurement centralization, continued focus on clinical talent, recruitment and management along with strong controls and turnaround in our focus units where the EBITDA contribution has improved to 19% from 14% in Q4FY25.
Let’s talk about the focus units first and then I’ll get to Mature and emerging Focus units which contribute to 29% of our revenue delivered a major turnaround this year. Focus units recorded a double digit revenue growth, actually more than double digit 21% revenue growth, all while improving efficiency to post a robust EBITDA growth of 66.6%. Yes, resulting in 422 bips EBITDA margin expansion to 15.4% a function of our continuous emphasis on patient centricity and operating excellence in every aspect of our business.
Let’s get to the mature units which is a large part of our business. 59% of our revenue comes from the mature units and that delivered a 13.5% revenue growth IOI along with 20.7% EBITDA growth YoYo the resulting EBITDA margin witnessed an expansion of 198bps YoY to reach 33.2% driven primarily through synergies and cost optimization efforts. Emerging units which is the newer units that we have, they contribute 7% of our revenue. They ramped up strongly 62.4% YoY revenue growth and 44% quarter on trailing quarter EBITDA growth.
The margin actually moved to 17.9% for this category. On a like to like quarter the EBITDA stands at 15 crores which was 70 lakhs in Q4FY25 for the full year. Financial performance Consolidating the strong quarter on quarter performance, QCL registered 17% revenue growth year on year to 4630 crores. The FY26 revenue growth has been supported by improvement in volumes focus on strengthening clinical programs and teams. IP volumes grew 7% while OPD volumes grew 10% to 35 lakh footfalls in our hospitals for the year Congo T revenue increased 23%.
Congo T mix improved 270bps to 59% of the total revenue. QCL recorded an EBITDA of INR 1066 crores, first time ever breaching the 1000 crore mark which represents a growth of 24.1% year on year. EBITDA margin for the year stood at 23% which is 136bps expansion over the previous year. EBITDA growth was bolstered by activities to realize synergies across all our units including procurement centralization which contributed to 85 odd crores to the bottom line. Therefore, 26 EBITDA has been supported by the best in class operating EBITDA break even at Nagar Coil which became ebitda positive in 3 months of operations.
Nagar coil contributed 30 crores to the EBITDA and currently stacks up at 28.5% EBITDA margin for FY26. Continuing our clinical augmentation, we maintain focus on doctor engagement models, talent acquisition and have onboarded 100 plus doctors clinical teams in FY26 which has aided the performance in volumes and specialized procedures. In Q4FY26 we reduced our ALOS by 2% to 3.9 days Kim’s health making significant strides in in transplants Kim’s performed its first cardiac transplant on a 10 year old girl.
In this quarter, Kim’s Health has conducted two dual organ transplants, a simultaneous kidney and pancreas transplant on a chronic diabetic as well as a combined liver and kidney transplant on a four year old child. The team at Care Hospitals performed a robotic procedure for a case of abdominal cocoon syndrome, an extremely rare cause for intestinal obstruction. Care Hospitals has strengthened its cardiac and vascular programs with the installation of its first cardiac laser at the Vajara Hills facility.
Care Banjara performed the group’s first dual chamber leadless pacemaker implantation. Care Hospitals B operated on a four year old with subic vst. The child was successfully discharged within four days of the procedure. Among Congo T specialties, orthopedic, neurology and gastro had an accelerated ramp up this year with each growing minimum 25% for the year. The focus on high equity care is visible across our specialties. Robotic procedures more than doubled in FY26 and moved to 1300 procedures for the year which is a 152% growth.
Initiatives to accelerate growth for the next year and beyond. Expansion continues to remain a key strategic focus for our leadership. We are committed to growing our footprint both within our home markets and in new markets through greenfield builds brownfield additions and M and A. We have upgraded our near term to midterm expansion plans and intend to invest 2000 crores to add 1700 beds in the next 3 to 4 years, staying true to the mission that we have to improve accessibility to healthcare. We plan to add 1300 of these 1700 beds in non metro markets.
Of the total, 1500 beds are planned to be added through brownfield expansions While the balance 200 will come from Greenfield. We got a few awards which I’d like to mention. Care Hospitals crossed a million subscribers on YouTube which is making us the second hospital in India to have done so. QCL received the Green Health Award at the International patient safety conference 2026. Care and Kim’s both received multiple awards and recognitions in clinical care, patient safety and nursing excellence.
We thank you for your participation this morning.
Puneet Maheshwari — Investor Relations
Thank you Varun. Now I would request Mr. Ramesh to take through the detailed cluster wise performance of Astadm.
Ramesh Kumar — Chief Operating Officer
Thank you, thank you Mr. Varun and good morning everyone. So I’ll begin with the cluster performance for the quarter and a full year followed by a key operational updates to begin with Kerala Let me begin with the clusters delivered a resilient performance this quarter sustaining its contribution to the growth. In quarter four FY26 the cluster reported a revenue of 604 crores reflecting a healthy 21% year on year growth. Despite the nurse strike during the quarter, the impact of which was limited.
Excluding Kasar Goat, the revenue grew by 18% year on year to 587 crores demonstrating the consistent strength of the core hospitals. The current quarter highlights a stable demand environment and marked the improvement in the quality of revenue. Growth was significantly bolstered by around 51% year on year. Surge in Medical Value Tourism While the macro headwinds led to the decline in the MVT from the uae, this loss was efficiently neutralized by the business from Maldives and African markets where renewed focus and a stronger local partnership have kept the patient flow steady.
Furthermore, performance was supported by consistent traction in oncology, a growing contribution from the Castle road facility and 11% increase in inpatient volume. A more complex case mix Further drove a 5% increase in ARPP IP rounding out a strong Cordo 4 FY26. On the profitability side. In quarter 4 FY26 operating EBITDA grew by 27% year on year while excluding Casagold, EBITDA increased by 35% year on year with margins expanding by 330 basis point to 25.6%. This is driven by a combination of operating leverage across mature assets, continued focus on reducing average length of stay and disciplined management of manpower and overhead cost.
With 3,000 beds and expansion and pipeline for over 800 beds including the recent brownfield addition, 130 beds in Minsk Kannur and 150 beds in Minsk Aricut Kerala is well poised to sustain the growth momentum. Karnataka Maharashtra cluster reached 394 crores in quarter 4 FY26 representing 11% year on year growth fueled by the robust realization. This performance was underpinned by a 21% increase in in ARPPIP driven by a higher volume of complex procedures in cardiology and neurosciences and the de empanellement of a low yielding government schemes.
At Astra Aadhar continued the cluster operational efficiency and the clinical expertise were further evident by the continued attraction in the MVT segment alongside a significant growth in advanced interventions. By focusing on the targeted hiring for the key Dr. Position, the Karnataka sub segment successfully improved its operating metrics and achieved a 3% year on year growth in inpatient volume for the quarter. This shift towards a high clinical complexity and talent acquisition resulted in a 25% increase year on year in our operational EBITDA at the cluster level.
Consequently margins were also expanded by over 260 basis point to reach 24.5% positioning the cluster for more consistent and sustainable growth moving forward. AP and Teladana cluster also reported a strong growth quarter 4 FY26 with the revenue increasing by 30% year on year driven by higher inpatient volume and a 13% increase in ARPPIP supported by a 200 basis point improvement in Congo mix operating EBITDA registered a sharp 113% year on year growth in quarter 4 FY26 with margins improving to 18.3% in quarter 4 FY26 with over 700bps expansion within the cluster as Ramesh Hospital group had a strong revenue growth at 32% year on year in quarter four FY26 with the robust 118% year on year EBITDA growth in ANT cluster.
Further to this we have operationalized 75 bids in Ramesh Homegol as per our planned expansion strategy. Overall the quarter reflects a steady progress across Kerala and Karnataka cluster and a sharp turnaround in ant. We are seeing benefits of the focus efforts on case mix capacity, utilization, cost discipline translating into improved operating performance. With strengthened clinical team and a clear expansion roadmap we are well positioned to sustain the growth trajectory and deliver consistent performance going ahead.
Thank you. I’ll now hand it over to Sunil for the detailed review of the financial performance.
Sunil Kumar — Chief Financial Officer
Thank you Ramesh. Good morning everyone. I am pleased to share the Astronomy Healthcare Financial performance for Quarter 4 FY26 for the quarter ended 31st March 2026 excluding our newly launched Kasargood Hospital for the first six months. Despite the global headwinds, the Astra India’s revenue increased to 1,166 crores reflecting a strong growth of 17% from Quarter 4 FY25. Operating EBITDA increased to 253 crores with a margin of 21.7% compared to 193 crores in Quarter 4 FY25 resting a growth of 31%.
Normalized PAT Post NCI for the quarter stood at 153 crores compared to 106 crores in Quarter 4 FY25 reflecting a growth of 45% year on year. For the year ended 31st March 2026 again excluding the newly launched Castlewood Hospital India revenues increased to 4617 crores up by 12 percentage from 4138 crores in FY25. Operating EBITDA increased to 969 crores with a margin of 21% for the full year as compared to FY25 registering a growth of 20 percentage. Normalized PAD positions here for FY26 stood at 451 crores compared to 357 crores in FY25 reflecting a growth of 26% year on year.
Moving to segmental performance, our hospital segment continued to deliver consistent and strong performance during the year. Revenues grew by healthy 17 percentage and operating a group by 31% leading to 240 basis points improvement in the margins. Importantly, the performance was consistent across hospitals at different stage of maturity. Our mature hospitals which are above 7 years old, contributing almost 80% of the total hospital and clinics revenue delivered 16% revenue growth and 26% operating EBITDA margin, operating at a robust ROC of 36.5%.
Hospital in the 3 to 7 year mentuity worket recorded 23% revenue growth and strong 21 percentage EBITDA with the ROCE improving by 470bps to 23.8 percentage. Our new assets which are less than 3 year olds or revenue growth of 15 percentage. Turning to our diagnostic business, I am pleased to share that Astralabs has successfully delivered turnaround since the start of their FY25 operating EBITDA margins have expanded from a negative 7.6 in FY24 to a positive 7.6 in FY25 and further to 12.8 percentage EBITDA margin in FY26 driven by a robust 32% year on year growth in external business, enhanced operating leverage and improved metal cost efficiencies.
This turnaround has translated to healthy ROC of 27%, a remarkable recovery from negative levels two years ago. For the year ended 31st March 2026 our capital expenditure stood at 549 crores with approximately 45% allocated towards expansion projects. We continue to maintain a robust liquidity position with cash and cash equivalents at 1327 crores while our gross debt remains at a moderate 701 crores. Additionally, we have a significant improvement in ROCE increasing by 180 basis points from 19.5 to 22.8 percentage excluding Castle code.
We have operationalized Whitefield block T with 159 bets on Raj Ramesh Sangamitra ongo at a Brownfield expansion with 75 bits in April 2026. Over the next four years we plan to add approximately 2,500 bids at the cost of 2,700 crore. Of this, 350 crore has been invested up to March 2026 with the remaining amount to be deployed over the next three to four years supporting our next phase of growth while remaining on for focus on disciplined capital allocation and sustainable profitability. With this we have laid a foundation for future growth as we move forward.
We are confident on building on this momentum with the same discipline and focus. On that note, I conclude my remarks and I hand it over to Puneet to begin the Q and A session. Thank you.
Puneet Maheshwari — Investor Relations
Thanks Sunil. Dear participants, during the Q and A session you will get a chance to ask a question by raising your hand through the raise hand icon in Zoom application. We will call out your name after which your line will be unmuted and you will be able to ask your question. I would also like to request to all the participants if you can introduce yourself with your name and company that you are associated with before asking a question. If you are not an association, if you are not associated with any company and you are NDL investor, you can highlight that as well.
Moving on to the Q and a session, the first question is from Mr. Tosif.
Questions and Answers:
Tausif Shaikh
Foreign. I’m audible.
Puneet Maheshwari
Yes you’re audible.
Tausif Shaikh
This is Tossy from BNB Pariba. First question is to Varun, can you tell us where does the industry currently stands with the Common Insurance and Parliament with private insurers and where which gives a uniform pricing with private insurers. Any of the hospital Estro Aster QCL has been on board in this policy and do you see this is a threat for the private hospital chains in coming years?
Varun Khanna
Morning Tasif. So Tassif, first of all, I think the parliament piece has been in play for a while. It’s not new. Two from a data standpoint, I don’t think. Well, I’m sure that between qcl, at least in qcl we haven’t signed up on this and I’m assuming Astra hasn’t as well. I have also not seen large tier hospitals get onto this platform. I think fundamentally while a lot of conversations have happened, there are two things that are bothering the industry around it. One is data privacy. Still, I don’t think the insurance companies have really figured out a way to ensure data privacy across so many hospitals and the other is transparency as to how this is being done.
Right. So till that gets sorted, I think this is, this is still a framework that’s been worked upon us is the way I see it.
Tausif Shaikh
But Varun, do you see this as a threat for private hospital if it’s completely adopted by the industry?
Varun Khanna
Well, it cannot be done unilaterally. It can only be done if private hospitals want to accept and that, you know there are two ways to see this. It can, it can actually save you a lot of costs on impalement, et cetera, et cetera if it is done right. So there are benefits and, and merits to doing it as well. But the current avatar is somebody going to get onto the bandwagon? My sense is so I, I, I would, it’s, it’s not coercive. So if that’s a question.
Tausif Shaikh
Thanks Varun, that’s helpful. Second question to Ramesh on the Kerala piece. I think despite the month of Ramazan the MBT business has grown significantly, especially in Kerala. Ramesh, can you give some color also what’s the current status of MVT patients as this have they started flowing in last couple of weeks.
Ramesh Kumar
So thank you Tosser for that question. Yeah, Kerala pieces, Kerala story is done well again you can see that overall performance has been really good and, and especially Mvt has done 41% year on year growth has been registered. So the, we have seen attraction from across yeah Middle east as well as what do you call Maldives and and of course African countries. There is a flow of patients coming in from all now the last few days. Yes, Middle east. We have found that a few patients Especially from Oman and uae a few less number of patients are flowing in but we have tried to keep that both steady by more number of Maldives patients started focusing on African countries and there is a steady flow which has been happening.
So we are trying to mitigate the losses through the expanded coverage what we have now. So we are trying to ensure that the impact is much not much felt and still continue to perform well. Maldives have been contributing more now.
Tausif Shaikh
Thanks Ramesh. Just last piece of question on Kerala. Where do you stand currently or the nurses issue. Has there been any negotiation between the private hospital and the nurses and can you highlight what are the total number of nurses in Kerala for ACM Healthcare and how many of them are currently working with a minimum wage of 20,000.
Ramesh Kumar
Okay. So when we talk about minimum wages and the strike which has happened in Kerala this started sometime in the mid of March and at that point of time their demand was they wanted the government. Every five years the government of Kerala issues a G Government not notification for the basic pay is is being you know issued by the government. But here at this point of time we have around 4300 nurses approximately in Kerala. And all these nurses are you know are paid the basic pay according to the the government notification.
And the new notification is yet to come. So they first started the strike asking the government to release the jio. At that point of time Kerala government had released the interim go which would take 60 days for them to go back and rectify the same the nurses of course the UNA didn’t want to wait for that time and they’ve continued with the strike demanding the private hospitals to take it up to 40,000 rupees per nurse. But as such we have the private hospital association and and of course we also were part of it and we ensured we requested them on April 13th we had a negotiation with them as well and the government has asked or the court had redirected us to especially the private hospital to mediate and get the things done.
So we had have spoken to them and on April 13th we have come to a settlement with them and yeah there is the strike is called off.
Alisha Moopen
Can I just ask Mr. Wilson also to add to on the.
Unidentified Participant
Yeah, yeah, that’s. Thanks. That’s a good question actually. So even though the demand they were asking for a basic salary of 40,000 actually we were able to conclude by giving a small increase only like and the overall impact may not be significant actually like you know, so we used to give an annual increment every April. So this time we had to Give something more than that one actually. So our total impact in Kerala will be 5 to 6 crores. That’s what we are given. Our total increment. What we are offered is actually at Calicut we are given 3500 rupees per nurse and which is in.
In. In cochin that became 4,000 and the remaining places at 3,000 to 250. That’s increment we have given. They were asking for a significant amount like Ramesh said, 40,000 rupees as the basic salary. So we were able to negotiate and conclude that one in a very nice manner. All the nurses are back.
Tausif Shaikh
That’s helpful. I have more questions. We’ll get back in the queue.
Unidentified Participant
Thank you.
Puneet Maheshwari
Thanks Nasir. The next question is coming from Damayanti Damiti. Can you please unmute yourself and ask the question?
Unidentified Participant
Hi, good morning all and thank you for the opportunity. My first question is on your RPOB and IP volume trends very strong across the clusters. So just want to understand from the management first what are the key initiative which is currently underway and which should help Aster to continue similar momentum in coming quarters and what kind of headroom you have in terms of growing the Congo tea contribution for your business. So that’s my first question.
Alisha Moopen
Sunil, you want to come in?
Sunil Kumar
Thanks Demanti. I think for the Astro for the quarter four years, as you called out, we had a very good IPO, almost 7 percentage. But also this includes a negative 8% growth in the KM cluster also. But I just want to call out in advance that the 8% negative growth is because of the DM parlement of the low yield schemes which even Alicia called out. If you remove that, we’re going to get into the positive 3% growth. So that way I think all our clusters, whether it’s a Kerala cluster, KM cluster or Indexer, everyone has done really well in terms of the growth capacity.
There are multiple things which working on one is that we’re strengthening all our processes. Whether it’s Dr. Engagement programs or whether it’s the op to op, you know, the processes or op to it conversion process or say the call center management. So we looked into all those things and we’re driving it. But the primary thing will be the Dr. Acquisition. So Dr. Acquisition is something which we are very very strong. And we also called out saying that in the last six months we have added more than new.
I’m talking about the other than the replacements, only the new doctors. So mostly around 36 plus doctors we added in the last 6 months. Alone thus that is something which we are expecting the ramp up to happen. And I think with the continued growth what you’re looking at, whatever we have done currently with the 7 percentage, that’s a fantastic growth to continue to happen over the next medium term.
Unidentified Participant
Sure. So
Alisha Moopen
Yes, sorry. Just to add to what Sunil was saying, I think asking about the Congo mix. Right. So this is where I think there’s the. There’s a huge room for us to kind of improve. We are sitting at I think at a blended level now 55% Congo contribution. We think we can definitely take it up to 60 and then 65 as well. You see a lot of the groups in that direction. So that’s something which will actually give us the. A good headroom to sort of further improve the numbers especially on the acuity and ARPP and stuff.
Unidentified Participant
Sure, that’s yeah that’s helpful. Thank you for that. So continuing the point on doctor engagement. So again I think I want to have some more color on what is helping you to get doctors because what we understand in markets like Bangalore the competition is really intense. So what are the key strategy again which is helping you to attract the best clinical talent and also the strategies for retaining the talent which you have in your network.
Alisha Moopen
Ramesh, would you like to come in?
Ramesh Kumar
Surely. So overall I think last few months we have added a good number of clinicians. Rightly said some of the star clinicians were onboarded and they pretty much the reason I mean they’re con why they were convinced to join as the simple reason one we had a bigger vision for Astro and especially when it comes to as you rightly mentioned about Bangalore market it is very competitive and thanks to we are having not only three units now and we are adding another two more units in Bangalore. So it’s quite visible for them that what is vision of faster.
So that is one, one attraction to all the clinicians who have joined. Secondly we are also looking at high end procedures and niche segments. High end work has been happening like the robotic transplants. So there is a good amount of what do you call kind of faith in the in, in Aster and Aster’s work which has been happening that has also been attracting most of the clinicians and they find that especially when, when it comes to Congo mix we are in certain areas we are truly leaders especially in neurosciences, oncology.
We are getting there. So some of the Congo mix also I think we have good clinicians on board that is also attracting other clinicians to join us and expand the each department and also attract more patients. So that’s where I think ring fencing these clinicians. Of course we have our, you know, vision for each and every specialty. Very clear. And the clinical excellence pathway, what we have, what we have been engaging then, be it technology, be it, you know, investment in and whatever and also the, the branding and taking it to the next level.
I think that is where the clinicians are quite happy about and they are pretty much with aster.
Unidentified Participant
Sure. And just I think want to hear Mr. Khan’s thought also on the clinical talent engagement again, anything or similar strategy for QCL as well, which is working for you.
Varun Khanna
Thank you. So, so essentially I’ll, I’ll go back to why a clinician would join more than what we are succeeding with because it is, it’s a lot to do with four or five elements that a clinician looks at. I think the first and foremost is relationships and our relationships in the market. The transparency that we operate with is probably top tier. The second part is we are developing a model. In fact, in one of the previous quarterly results I’d spoken about developing Clinique because our focus on clinical independence and outcome is so significant that that is also yielding a lot of gains from a volume standpoint.
And that is what the clinician wants to. The clinician really wants that you should allow them clinical independence. You should be focused on outcomes, you should be able to draw referral volume into the center because of the good work that you’re doing. That coupled with the technology investments that we’re making is another big reason why clinicians really want to move. And I think the last part is largely commercial and we are top tier on that too. So I think that is the holistic mix. Now it depends from one to the other as to which one plays out more than the other.
But I think our ability to connect, to forge alliances, relationships, partner is better than anybody else today.
Unidentified Participant
Yeah, that’s helpful. Thank you, team. I’ll get back in the queue,
Puneet Maheshwari
Thanks. The next question is coming from Mr. Kunal. Kunal, can you please unmute yourself and ask the question?
Unidentified Participant
Yeah. Hi, good morning. So my first question is on, you know, quality care. So I see that the mature units have grown 14% as have the focused units. So just wondering what the growth drivers can be going forward because some of the things seem to be very well optimized like Payer mix or Alos. So would it be the case mix or will it be the expansion going forward? Just want to get your thoughts, sir.
Varun Khanna
Thank you, Kunal. So Kunal, the growth Drivers for each one of those categories is slightly different. So let me, let me try and give you some color on that. So the good part is our mature has continued to grow. Mature hospitals are currently growing 13 and a half, 14% on the top and 20 plus percent on the bottom line and they are in excess of 30% EBITDA profile as well. So what’s working for us there is still enhancing complexity. Alicia spoke about it and let me just reiterate the same thing. We are currently at about 59% Congo T mix and my sense is we will continue to grow that because I told you that we are under leveraged on oncology and that is one piece that we’ve still not got our investments rolling.
In fact, this year onwards onto the next two years, you’ll see a significant growth in oncology volume in our network. So that will play out from a mature hospital standpoint. If you look at our emerging and let’s say the focused assets, we’re still sub 20% of it in there, we’ve done extremely well. But the Runway is still a long way for us to grow and various things are playing out. So one, wherever we have under occupancy, I think we’re bringing in the clinical talent that is required to fill up the gaps that we have.
It’s called the golden tree on our parlance, if you missed out something, one of those hospitals, we try and bring that talent. What is interesting is that our brands have a long legacy and some of the work that we’re doing in Hyderabad essentially in care is bringing doctors who left us back. Because we’ve always stood for ethics, we’ve always stood for integrity. The consumer value perception is phenomenal around the brand and with the investments that we are making, some of these assets are doing extremely well.
In fact, the Hyderabad sticky market, you’ve always known that. In fact, two years back when I came in, most of you would ask me about what will happen to Hyderabad. So Hyderabad has started to grow so significantly. We are now seeing huge growth on the top in terms of volume and ebitda has grown 66 odd percent. So I think different levers for each one of those categories and currently all seem to be fine.
Unidentified Participant
So I assume you meant it’s across their units. Right? The emerging, the new ones and even the focused units.
Varun Khanna
If you see the growth, if you see the growth for signpages, it’s across all units. So our, our focus units have grown top 25 odd percent. Our mature have grown 14 odd percent. Our emerging have grown 60 odd percent. So yeah, the playout is across the network.
Unidentified Participant
Sure, sure. So second point is on so the synergies between the two companies. I was given to understand that a lot of these synergies will start flowing in once the merger consummates between the company. But I think in your presentation you mentioned almost 200 bips. I think 85 crores of synergies that you’re seeing in Care. So are we seeing something similar Aster also? And if that is the case then going forward, you know, once the merger completes, would there be even more synergies, more than what you have booked so far.
Varun Khanna
So Kunal, first of all the synergies that I’ve alluded to are pre Astra QSIL merger. Right. So these are. You gotta understand that within QSIL also we are in a way merging three companies. We acquired Care, Evercare in Bangladesh and Kim’s in Trivandrum and Tamil Nadu. So that’s the synergy that I’m referring to. So bringing the three entities together has also given us synergies on account of procurement, on account of insourcing of food, a lot in terms of AMC etc. And that is the 80 crores that I alluded to.
80, 85 crores that I alluded to. So that, that has. We are, we are. We’ve still not started the work on Astracusel synergies really. And they will start to flow in post merger.
Unidentified Participant
Great, great sir. And just one more if I can, on Aster sir, on the greenfield expansion you have around 100 capacity beds in the next couple of years. So just wondering how will the, you know, cost profile move going forward and the margin impact, if any, you know that we should expect only in Astra’s business in the next couple of years.
Sunil Kumar
Yeah. Kunal, if you look at the last year, right, you saw only Kasar Gold, you know, commencing the operations sometime in October. And if you looked at the margin profile, the impact is hardly 60 pips, right? Because we closed at 20.4 including Kasar Gold. If you remove the Castle board which approximately I think we have, you know, EBITDA losses in somewhere negative of around 19 to 20 crores. So it’s probably 21 percentage. So it’s only 60 pips which is impact. And again it’s our own cluster so we don’t.
We expect to bounce back very quickly and break even in a quarter or two. Next in the FY27 you look at, we have got already two brownfield expansion we just started. Right. One is the, our raster white feed block D which already commenced the operations in April. And also the other unit is in Angol, which is another scientifier beds on the existing hospital. We commenced that was in April. That means we got almost 200 plus beds of brownfield expansion, which is usual. You can see that it’s a bit accretive.
Just to give an example, a year back in Kanur we were running at 300 beds. We added 100 beds. The margin expanded by 400bps. We went from 18 and a half to 22 and a half. Right? So keeping that good thing is that in this year already you’re starting with the brownfield expansion, which is a, you know, a bit aggressive. Secondly, only this year we are expecting only our Trivandrum to commence sometime in October. That’s only the H2 beginning. And you know already in Trivandrum it’s part of the Kerala cluster.
Second QCELL QCL entity kims already it’s present there. It’s very under penetrated. So we expect to do really, really well. So even whatever the losses comes in, it’s hardly any dilution. Even with that losses I expect from the current year EBITDA margin should only grow. The third point is also to be very important to note it is that with the merger very much, I would say hindsight sometime in the quarter one you should see that majority of the period will be under the merged entity. Right? So we’ll also have.
We also already. I think Varun called out that synergy is going to start after the emergency, right? That’s something which you’re already working on. And I think we will hit the ground from the day one. And that should also bring and help us in ensuring stability in the margins. Also growing the margins also. So that way with all these levers being there, from the cluster presence to the brownfield expansion already there and also towards the synergy coming in, we don’t expect any margin dilution.
It’s year on year we’ll have. We’ll grow in the margins.
Unidentified Participant
Good to hear that, sir. And all the best.
Sunil Kumar
Thank you.
Puneet Maheshwari
Thanks. Manal. We would request you to limit your question to two, but not more than three per participant at a time. With this, the next question is coming from Mr. Siddharth. Siddharth, can you please unmute yourself and ask the question?
Unidentified Participant
Hi, thank you for the opportunity. Congrats on a good set of numbers. Fairly strong set of numbers. Just wanted to understand what was the primary. I have a few questions. I’ll take my top three. What was the primary challenge in the slow growth Even in Karnataka IP volumes which were at 3% versus you know, 8, 9% in the overall group. Right. And within that, if you could give us some understanding, you mentioned that there was a degrowth because of Astor Aadhaar. Was that a negative margin scheme that you took away and how should, how should one think of recouping that set of patients?
So that was question number one. Question number two is on, you know, if you could give a sense of what’s the share of chemo and dialysis within Onco and Nephro which I would assume is is more daycare and therefore, you know, brings down the ALOs, you know. So that was one, that question two and question three was if you could share any specific AI or robotics implementation that you’re doing within ASTER or Qcell.
Sunil Kumar
So let me jump in Siddharth with the first two questions. One is on the Karnataka. Yes. You’re asking, saying that if IP volume for other things is at least in the I single digit to a double digit, why Karanaka Marshall cluster is at 3%. Yes. As I called out very clearly what we exited is the low yield schemes. I think we are very clearly called out. It’s a government scheme, it’s a low yield scheme. The R pops compared to a cash market it’s less than 50 percentage. That’s how it’s been. And good thing is that we exited that.
And also we, one of the reason we exited also is that there’s a capacity bottleneck in Astra. Other it’s already running at 75% occupancy. We will be looking at how to expand in Kolhapur also. At the same time we want to see that whatever the capacity we have, we optimize for the cash and TPA patients. Second in the K and M. Yes, we have a positive 3% growth. There are two parts, right. One is that competition intensity is very, very high. Right. And maybe before that, let me take a step back. If you look at FY24 and 25 in KDM cluster, we’ve been growing more than 20 percentage.
That’s mainly because of our Astro Whitefield hospital which started two years back. And the ramp up was really, really good. We achieved 44 crores per month in less than two years. And that is a ramp up. If you want to compare, CMI took more than six years to achieve that. That’s a very, very fast ramp up. And we can’t expect the same revenue ramp up at 20 plus percentage when a unit has already reached to a mature phase now. So keeping that in mind, that’s the reason why also one of the reason why the revenue growth has tapered down to around 10 to 11 percentage and volume has been around 3 percentage growth.
But at the same time we also had competition intensity especially in the north of Bangalore. We had attrition of one or two teams also. And good thing I also called out saying that we got them back already. Second most important thing I think we didn’t call out one of the general surgery or other team which left in quarter three to the competition joined back in quarter four. Right. That basically shows the strength of our clinical ecosystem and the management what we do there that’s a very, very strong.
So we don’t expect this to be the norm. So we expect to go to mid to high single digit. Good thing is that all the doctors what we have gotten now already there in the stability. So we expect the volumes to trickle down in next one to two quarters. Second also is that you see that April already we launched the Brownfield Hospital also which is the block D Whitefield block D which is women children hospital also we have doubled the number of doctors there. We had around 10 or 11 doctors in women children.
We have added another 11 doctors there. So that is something which ramp up is expected to be really good. So whatever you see is a 3% is just a one off thing. It’s not a structural issue. We should bounce back very easily. Second on the onco usually the broad contribution is that med donk is approximately 50 to 60 percentage. 30, 35 percentage come from surgical oncology of the whole oncology and 10 to 15% from radiation. Out of the medical oncology you can see 60% will be chemo and 40 percentage usually is in the immunotherapy and targeted therapies.
What we do, I I hope that answers the question. Alicia or someone who want to take up the ea. Yes,
Varun Khanna
Let me take the. Let me take the AI question. So Sid, thanks for the question. You know this is more of an academic question than currently in terms of what’s happening on the ground. So essentially AI will in the near term to become impact patient safety, the operating world financials and clinical. Now as a company we’ve already started working on all four tiers. So if you ask us what are the early successes we’ve been able to bring in cdss which is AI enabled. We’ve been able to bring in call center support which is AI enabled.
We’re looking at solutions that can actually save time for the doctors. When the patient comes into the OPD by pre populating some of the EMR work through AI, we’re looking at significant clinical augmentation happening through AI. So there are two parts to that. One is looking at radiology getting more efficient. We are, as I told you last time, we are setting up rather Asia’s first, you know, radiotherapy platform which will be enabled. This is the first EOP platform that Electa is sold in India as well as in Asia which is AI enabled.
So a lot’s happening on all four of these sites. We are also mindful that some of the newer technologies on AI are currently a huge cost and their use cases from a revenue generation standpoint haven’t seen the light of the day. So I think we are being very particular in terms of, because technology is galore. But in terms of what we can really use to enhance our metrics is something that we are mindful of. On the sales front we’ve seen significant improvement with our CRMs now getting AI enabled, our call centers getting AI enabled and our conversion ratios have gone significantly better.
All of that is playing out and that’s how the volumes have gone to 10% kind of a growth as you see on the IP and double digit growth on the OP as well. I don’t know if there’s a specific question that you wanted to ask, but it’s a broad based question that you touched on. So I’m probably giving a little bit of a problem. No, I think
Unidentified Participant
This does give Varun. I think this is fairly, fairly helpful in terms of, you know, what you’re, what you’re planning and I, I concur with you that AI is probably fairly early stage and theoretical today. But given, you know, given that there is a merger, you, you’re, you know, going to be leading the entity. It, it does help to get a color from you. So thank you so much for that. And, and just a follow up on, on what Sunil mentioned on you know, on some of the challenges in Karnataka you’d mentioned.
So I get the capacity bottleneck in, in Kolhapur. But for the rest of the hospitals you also called out some, some other sort of capacity utilization. Is there a bottleneck elsewhere? Because that seems to be more like mid mid-50s occupancy. So there does seem to be capacity, right?
Sunil Kumar
Yes. Siddharth, in KM we have capacity for example, Ashley, CMI is at 60% of less occupancy. RV is at 69. Our Whitefield we’ve got, we added 150 beds. Right. So if you include that it has got still only 55% plus occupancy. So I think we’ve got a great Runway in Karnataka cluster to add bets also. You know that we’re also coming with Sarjapur in next one more year and we have Ashanpur in three more years. So I think we got a very good Runway towards it.
Unidentified Participant
Thank you.
Puneet Maheshwari
Thanks dad. The next question is coming from Mr. Ame. Can you please unmute yourself and ask the question?
Unidentified Participant
Yeah. Am I audible, Puneet?
Puneet Maheshwari
Yeah, you’re audible.
Unidentified Participant
Yeah. Thank you for giving an opportunity to ask a question and congrats to the management on good set of numbers. So first question I have for Varunji. So we, we will intend to spend close to 500 crore in Hyderabad cluster to, to get that cluster to its potential, has that investment over and where it has been spent. And also along with this, if you can give us the CAPEX guidance for the QC for next two years. Thank you
Varun Khanna
Amir. Thanks. So I don’t know where the 500 crores number essentially but the work that we are doing in Hyderabad is turning every asset around. So we’ve completed Banjara. Let me stick to Manjara for a minute. We are also now working this year to enhance oncology service in Banjara. So we’ll be able to bring in radiation in Banjara which is going to be a significant bump up. We operate an OPD building there and the OPD building will also be an IPD building going forward. So those are the plans that we’ve laid out for Punjara and therefore a significant transformation is going to happen there.
Hitech, as I mentioned to you earlier, is doing extremely well as an asset. We’ve grown 65, 70% of the top over the over quarterly averages last year to this year. So that’s been a significant upside as well. Now we are working on the Nampali asset. We are sprucing it up because I think it needs a little bit of work which will allow us to enhance our RPOB and also be able to take significant higher footfall. This also comes along with adding clinical capability across the board. Right. So every asset will see clinical and as I told you, Hyderabad is one market where we are being seen very favorably.
It’s not a market that has grown volumes very significantly. But the fact that we’ve been able to grow the market well ahead of our competitors should give you a sense that I think we’re being preferred both by the consumers and doctors alike. So that’s happening in Terms of overall bed capacity expansion I think I’ll give you a sense about 1700 odd beds will get added. 2000 odd crores of expense will happen for those 1700 beds and which is what we call the Project Capex. This will be revenue accretive because 1500 of these 1700 beds are actually brownfield.
It’s only 200 which is, which is greenfield and therefore I’m desperately looking forward to these beds coming in because they’re coming in assets where we need more capacity. And as I mentioned to you earlier, wherever we are in the mature setup our strategy has been add more beds, add more capacity, bring more complexity. So we are kind of firing all cylinders onto that and so far so good. We are hopeful that Bhubaneswar as well as Raipur, both the assets will get incremental capacity and clinical complexity from oncology standpoint as well.
Outside of that our guidance on capex has always been clear. We’ve stuck to the same number. 5 odd percent is the CAPEX spend when it comes to the annual capex spend to spruce up either new clinical programs or to, sorry, spruce up the existing facility or to add clinical programs. So Generally the breakup is 3, 2 which is 3% is spent in terms of refreshing what we’ve already spent and 2% becomes incremental every year. That’s the cost for running the business. So we stick to that. We’re again very prudent in terms of managing those spends.
As I mentioned as a part of the synergy between Kims so that I’m very clear between Kim’s and Care, we’ve already started to find synergy in the procurement of equipment as well and this is pretty significant. So the 5% spend earlier and the 5% spend now is giving us significantly more than what you used to give earlier. So I think that’s, that’s how all of this is working out so far.
Unidentified Participant
Sure. And this year we have ended at around 16, 70% top line growth and around 1 and 1.5% margin expansion. Looking at the improvement we are doing across the clusters ahead as well as the around I think 900 bed addition we are doing for next two years at least. So you expect this growth momentum and the margin expansion to continue for next two years?
Varun Khanna
Yes I do. I mean we’ve gone to a solid start and I do see that the margin expansion as well as the top line growth will continue. I think the strategy is firing and again strategies are not made for a year. I think the last year has just been a testimony of the fact that what we’ve started is the right thing to do and which is where we started to see the numbers roll in. As I mentioned, our team’s rock solid, very committed and we are reasonably sure that we’ll continue to add to what we’ve done last year.
Unidentified Participant
Sure. Thank you so much. I just have last question on Aster on the white field unit particularly, I think Karnak Cluster has looking like it is coming out of woods quickly after these dealership changes. But if you can give some clarity, how is the occupancy now in Whitefield for FY26, how it has moved year on year and what profitability this unit is working on so that we can get some sense what potential it has in terms of the EBITDA addition for next two years. Thank you so much.
Sunil Kumar
See on the occupancy, currently it’s at 60 occupancy. That’s only for the block ABC which is equals to one. Now that the block C is moving to the block d, that’s another 159 bits getting added. That’s a separate, you know, you know, I would say road path. What we have in addition to that, the MD, 50 beds which is there that will integrate to the existing multispatial hospital. And also I think I called out even for the CMI where we are coming another year or so we’ll have the 100 bits expansion on top of the existing hospital.
Their already occupancy is still 56. So there is a good, you know, room but only thing in Astra RV because it’s just a 250 bed hospital without having oncology there. There the Runway is little lesser because currently already occupancy is at 66 percentage. So Runway but still you can go up to 75, 80 percentage. Anyway, so that, you know, room is already there. And from the EBITDA margin point of view, I think only in the white field you ask for, it’s already in the high teens. Right? High teens is the margin with the white field coming up I think then you can look at more than mid 20s.
Is the margin what we are expecting to reach?
Unidentified Participant
Sure, sure. Thank you so much. It is quite helpful. Thank you so
Puneet Maheshwari
Much. Thanks Amir. We would like to highlight that we’ll be giving preference to attendees who have not asked the question before. So in that line, the next question is for Mr. Vivek. Vivek, can you please unmute yourself and ask the question?
Unidentified Participant
Am I audible?
Puneet Maheshwari
Yes, you are audible.
Unidentified Participant
Great, thank you for the opportunity. I just have A couple of questions. One was with regards to the performance in the Andhra and Telangana unit, the growth has been outstanding in that particular cluster. So just wanted to understand what steps or, or have we taken any particular steps to, you know, do the course correction and going forward what can we expect in terms of a sustainable level in terms of both revenue and margins for the cluster.
Sunil Kumar
Vivek, thanks for the question. See there are three main hospitals. One is the Ramesh hospitals group. Then we have two hospitals which is the in the Hyderabad Astra prime which is a smaller 150 beds and Narada 3 hospital in Tirupati which is the 150 odd bits again so in this I think the two hospitals specifically driving the growth is the Naranadri hospitals and also Astramesh hospitals. Naranadar hospital I think we opened up almost three years back. It’s doing really, really well. Even the current year you just seen we’ve seen a 46% growth in the revenue and almost 75% plus growth in the EBITDA.
Because one of the good things why the Naranada hospital growing really well is that we’re able to add good clinicians there. And also the market is underserved currently so we are able to execute things at the right time. And also in major of the specialties like cardiac and ortho. Another general specialties we were able to handle at the second in line also that is helping us in taking more volumes and also we’ll be looking at now to convert some of the general waters into single rooms so that we can expect more RPOC growth.
Also the second big change what we’ve seen is the Ramesh hospitals. Ramesh hospitals were little stagnant for last couple of years and they also lost a few doctors in the quarter one, quarter two and in addition to that they also good things that when the attrition happened they added clinicians in 3, 4 specialties including the nephrology, pediatric department, ortho and cardiology. That’s their been, that’s their stronghold there. And we have seen after that, I think from the end of December we have seen a good growth momentum.
It’s not a oneof growth. What you’ve seen last four months and even the April trends are looking very similar, similar. So with that they have achieved more than 32 percentage, you know, revenue growth and why EBITDA has been growing. It’s very simple because you’re sitting on a low base, fantastic growth. We ensured that there is a good operating leverage which is working currently we are holding on to the cost, not jumping into hiring more manpower we can leverage on the existing fixed cost which is anywhere there and I think because if it’s a one or two months I would have said it’s just a one off and we’ve seen a good Runway for last four to five months and I think we will expect to continue to grow.
Not maybe not in the similar manner but I think the Runway what we created I think we expect Ramesh hospitals to continue to do well.
Unidentified Participant
Thank you for the detailed answer. Secondly just wanted to understand from Varun about the QSIL expansion. Right so firstly what you had mentioned about QSil. So two things here. One is with respect to if you could provide the expansion plan by cluster for QSIL and secondly what you had mentioned about the QSIL expansion budget which is around 2000 crores for 1700 beds of which 1500 is approximately brownfield. So just wanted to understand the per bed capex that you plan on doing approximately for the brownfield and the greenfield units that QCELL has in its pipeline.
Varun Khanna
So, so the blended line of the vary vary by which hospital what kind of expansion are we doing? But per bed generally comes about 1 to 1.1. Right. That’s what the number would be for you to take back in terms of expansion. You know, you know this a quick run through. You look at Bhubaneswar and which comes this year there’s a. There’s capability enhancement happening in Raipur and there’s capability as well as bed expansion happening in B and that’s, that’s largely for this year. FY28 we expect to add bed in Banjara and capability in Banjara.
I, I probably brought that response to the previous question as well. We will add capacity, we will add capability in a very significant way in Manjara and and we were waiting to see if we are able to turn the asset around and we start to get favorability both from the consumer patients as well as the clinical fraternity and that seems to have happened. People now are seeking more from us. So that is another investment that we’re making. We’ve been very excited with the Nagar Coin launch. We’ve done extremely well the the assets at about 28, 29% EBITDA and growing month on month, month on trailing month rather we are, we’re now looking at expanding that too by another 100 beds.
So that’s another expansion that’s going to happen. We are adding beds in 28 in Nampali as well. As I just told you we’re turning that asset around, sprucing it up, and with that we will need more beds to come in. Some of the other projects that we are currently looking at beyond that is going to be Malakpet, Chattogram, Vizag. So it’s across the board. You know, when you’re looking at Brownfield and Greenfield, there’s one green field that we’re doing, which is indoor. 14 assets are on brownfield, which cumulate to the 1500 bits that I spoke about.
Unidentified Participant
Just on the per bit capex, you said 1 to 1.1 crore. Right. So can you break it down for me in terms of brownfield per bed capex and green field per bed capex?
Varun Khanna
Yeah. So Greenfield will come to about 1.5 crores and brownfield will go down to about, you know, in the range of 0.8 to 1.3, depending again on complexity. See, I, I think there’s no one number. We’ll have to give you a number by specialty, by, by each unit, which is not something that I intend to share at this point in time. But the fact is that if you are adding a linear, linear accelerator setup or an ONCO setup in a particular hospital, then the numbers will go up. So it is not just the bed, it is also the complexity and capability that we are sprucing up in the asset.
So, Vivek, there’s no one answer. There’ll always be a broad range and the broad range for Brown will be between 0.8 to 1.1. For green, could, could. It could be about 1.5, 1.6.
Unidentified Participant
Got it, got it. Thank you, thank you for the explanation. Just a couple of bookkeeping questions. Just wanted to understand what comprises as a minority share, as a percentage of our total profit. Profits. And what should we take that as a percentage going forward?
Sunil Kumar
Vivek? In case of aster, it’s around 8 percentage. And that is with only two units currently, which is a Mims, we have still a minority of 20% there and Ramesh hospitals around 30 percentage. So overall at a console Aster level, it should be at 8 to 9 percentage. I think maybe QSil should be between 15 to 20 percentage. So blended should be between 10 to 15 percentage should be the
Unidentified Participant
Overall extent. 15, right,
Sunil Kumar
Yeah,
Unidentified Participant
Got it. And secondly, just wanted to understand your Rosie. Rosie number. Right. So as per what I, I could understand in terms of Rosie calculation, my Rosie number is coming out to be a bit different. Different to what has been reported in our presentation. Right. So if you could help me out with how.
Sunil Kumar
Yeah, See, in case Of Aster, what we exclude is only two things. One is the revaluation reserve that related to the land revolution reserve which we taken up when we converged from the old I gap to India’s. So it’s just a book entry, there is no actual capital employed. Second is a CVIP because that asset is still not deployed to earn your profits or revenue. So These are only two things we exclude. In case of QSil, I think we exclude the intangibles right when they, because as QCL they acquired the entities in Bangladesh and specifically in Kims, they have certain intangibles like a brand and goodwill.
That is something they’re excluding. And that’s the only three differences we will have between your calculation and our calculation. But we’ll be very happy to share it offline. Also,
Unidentified Participant
Just one more thing I wanted to ask about QSil. So the QSil EBITDA margin we report at around 20, 21% but as per the annual report that I could see Qsil the EBITDA margin is coming out to be around 17 to 18%. If you could make me understand like if, if I’m missing out on anything in terms of understanding the EBITDA margin with what’s reported in the aster ppd vs what I can see in the QSIL financials.
Varun Khanna
So Vivek, there is a, there’s one time that impacts us broadly around, you know, the one time that we are doing on merger and also some of the work that we are doing with consultants to enhance the productivity. So all of that is one time. We can probably provide you a breakup of that if that’s desired later.
Unidentified Participant
I mean, yes, I can get back to. Get back on this later. Sure. Thank you.
Varun Khanna
Thanks
Puneet Maheshwari
Vivek. If anyone, other attendees would like to ask a question, please raise your hand. Okay, so there is no more question to the management. Thank you all. This concludes the earnings call for this quarter for Academ Healthcare. I thank the management and all the attendees for joining us today. If you have any further queries and questions, please get in touch with us. Thank you.
Unidentified Participant
Thank you.
Varun Khanna
Thank you everyone. Bye bye.
Unidentified Participant
Bye bye.