Aster DM Healthcare Limited (NSE: ASTERDM) reported consolidated revenue from operations of ₹1,186 crore for the quarter ended December 31, 2025, representing a 13% year-on-year increase. Growth was led by higher patient volumes and improved realizations across core hospital clusters.
Operating EBITDA rose 11% year-on-year to ₹224 crore. Operating EBITDA margin stood at 18.9%, lower than the prior-year quarter due to higher staff and operating costs, but improved sequentially during the year.
Profitability
Profit before tax increased 8% year-on-year to ₹140 crore. Profit after tax declined 1% to ₹67 crore, reflecting higher exceptional expenses related to labor code implementation and merger-related costs. Normalized profit after tax remained flat year-on-year at ₹81 crore.
SWOT Analysis
Strengths:
- Double-digit revenue growth in core hospital segment
- Improving operating leverage over nine-month period
- Diversified regional hospital network
Weaknesses:
- Reported profitability affected by exceptional items
- Margin sensitivity to staff and doctor cost inflation
Opportunities:
- Capacity expansion across key clusters
- Higher complexity procedures improving realizations
- Procurement and operating efficiencies
Threats:
- Regulatory cost pressures
- Ramp-up risk in newly commissioned hospitals
- Competitive intensity in key regional markets
Segment Trends
Hospitals contributed the majority of revenue, with 15% year-on-year growth supported by inpatient volume expansion and improved case mix.
Clinics and wholesale pharmacy segments remained smaller contributors, with wholesale pharmacy revenue declining following exits from select loss-making units.
Nine-Month Performance
For the nine months ended December 31, 2025, revenue from operations increased 10% year-on-year to ₹3,461 crore. Operating EBITDA rose 15% to ₹702 crore, with margin expansion supported by procurement efficiencies and operating leverage. Normalized profit after tax increased 12% year-on-year to ₹281 crore.
Margins and Costs
Material, employee, and doctor costs increased in line with revenue growth. Operating margins were supported by procurement centralization and cost control initiatives, partially offset by wage-related provisions arising from the new labor codes.
Balance Sheet and Capital
Total consolidated assets stood at ₹7,894 crore as of December 31, 2025. Net debt levels remained stable during the quarter. Capital structure reflected ongoing investments in capacity expansion and acquisitions, including increased stake in Prerana Hospital Limited.
Expansion & Ongoing Projects
The company continued execution of hospital expansion plans, including greenfield and brownfield bed additions in Andhra Pradesh, Telangana, and Kerala. Several recently commissioned units reported improving utilization and margins during the quarter.
Stock Performance
Aster DM Healthcare shares were volatile following the results, reflecting investor assessment of margin sustainability and exceptional cost impacts. The stock’s performance over the past year has tracked earnings recovery and restructuring developments post GCC business separation.
What Investors Are Watching
- Sustainability of operating EBITDA margins
- Ramp-up performance of new hospitals
- Normalized profit trajectory excluding exceptional items
- Capital expenditure and funding discipline
- Execution of merger with Quality Care India Limited
Risks & Concerns
- Elevated staff and operating costs
- Execution risk in new hospital expansions
- Regulatory-driven cost increases from labor code changes
- Integration risks related to acquisitions and mergers
Forward Outlook
Near-term performance is expected to remain linked to volume growth, margin stability, and execution of expansion projects already disclosed. Profitability will continue to be influenced by normalization of exceptional costs and operating efficiency measures.