Laxmi Organic Industries (LXCHEM) reported a topline of Rs7.1bn, reflecting a decline both YoY and sequentially, primarily due to continued pricing pressure across its product segments. However, the company recorded a modest volume growth of 1% during the quarter. The Specialty Chemicals segment outperformed in FY25, with EBITDA margin improving by 200bps to 23%. However, one of the products in this segment has undergone a regulatory phase-out, which is expected to impact topline performance in the near term until the replacement product planned comes online. The Essential Chemicals segment, which contributes ~69% to the company’s revenue, witnessed a sequential revenue decline of 9%. EBITDA margin for this segment fell to 3% in FY25 from 4.2% in FY24, as pricing pressure continues to impact segment profitability. Management has guided that the Fluorochemicals segment is expected to contribute 40–60% of the Rs2bn peak revenue potential in FY26, with full ramp-up expected by FY27. The company has announced a total capex of Rs11bn aimed at doubling its revenue by FY28. On the demand side, the Agrochemicals segment remains soft, whereas sub-segments such as pharmaceuticals, printing & packaging, and colors & pigments continue to show stable demand trends. The stock currently trades at 29x FY27E EPS. Using SOTP valuation, we value it at Rs172 and maintain our ‘Reduce’ rating on the stock.
- Revenue declined due to weakness across segments: Consolidated revenue stood at Rs7.1bn (-10.4% YoY/ -9.7% QoQ) (PLe: Rs7.2bn, Consensus: Rs 7.7bn), the actual topline was lower than our estimates. Essentials Segment revenue decreased by 10% YoY/ 9% QoQ in Q4FY25, while it increased by 1% in FY25. Specialty segment revenue decreased by 7% YoY/11% QoQ in Q4FY25, while it increased by 14% in FY25. Specialty segment now constitutes 31% of overall revenue vs 30% in Q4FY24 & 32% in Q3FY25, the revenue contribution from the Essentials segment remained stable YoY, while increased by 1% sequentially to 69%.
- EBITDA declined on both YoY and sequential basis: EBITDA came in at Rs590 mn, down 34.4% YoY and 21.1% QoQ (PLe: Rs539mn, Consensus: Rs620mn). EBITDA margin dropped to 8.3% from 11.4% in Q4FY24 and 9.5% in Q3FY25, mainly due to higher operating cost.
- Concall key takeaways: (1) The company has less than 10% exposure to USA, tariff impact on Laxmi is expected to be neutral. (2) Acetic acid price decreased by 11% and Ethanol price decreased by 15% in FY25 compared to FY24. (3) Other expenses increased during FY25 due to the steep increase in freight rate. (4) The company has signed LOI with Hitachi Energy to set up production of an eco-efficient gas used in Hitachi’s SF6-free high-voltage switchgear portfolio; this product is currently sourced from China. (5) Total volumes increased by 11% YoY in FY25, while for Q4FY25 volume increased by 1%. (6) Company has received EC and the factory license for its Dahej facility. (7) Average Ethyl acetate long term spread over Ethanol and acetic acid were $225, currently they are $140-$150. (8) Ethyl acetate is 80-85% of essentials revenue, aim is to reduce it to 65% by FY28. (13) One of the products is undergoing a regulatory phase-out in specialty portfolio, a substitute has been lined up, but there will be an interim impact on the topline due to this transition. (14) From Q4FY25, Fluorochemicals segment started contributing to topline, 40%-60% of peak revenue expected in FY26 and peak revenue by FY27.
Max Healthcare Institute (MAXHEALT) reported healthy EBITDA growth of 26% YoY to Rs 6.32bn; in line with our estimates. The company showed phenomenal growth (18% EBITDA CAGR) over FY22-24, despite negligible capacity additions. We expect pick-up in the growth momentum given 1) strong expansion plans (+3500 additional beds over FY24-27E), 2) improving payor mix and 3) Bolt on acquisitions like recently added in Lucknow, Nagpur and Noida. Operational efficiency has also been commendable, especially in competitive markets like NCR. Our FY26E/27E EBITDA remains unchanged and we expect EBITDA/PAT to grow ~2x over FY24-27E. We ascribe 35x EV/EBITDA based on FY27E. Maintain ‘BUY’ rating with TP of Rs. 1,300/share.
- In line EBITDA, existing units EBITDA grew by 13% YoY: Base business’s EBITDA improved 13% YoY to Rs. 5.65bn with margins flat YoY to 27.2% in Q4. During Q4, total of 188 additional beds were commissioned across Lucknow, Dwarka, and BLK. The greenfield Dwarka facility, which was commercialized in Q2, achieved EBITDA breakeven in Q4. New units which now comprise of Noida, Lucknow and Nagpur contributed EBITDA of Rs 670mn (vs Rs 650mn QoQ). Overall margins were flat QoQ to 27.2%. Consol occupancies were steady YoY and QoQ at 75% given the new beds consolidation. ARPOB was flat YoY and improved ~2% QoQ to Rs 77.1K. Existing units ARPOB came in at Rs83.8k; up 7% YoY.
- Robust revenues across existing and new units: Consolidated revenues came at Rs. 23.3bn (up 29% YoY); of which Rs.1.2bn, Rs. 1bn, Rs. 780mn and Rs. 550mn were contributed by Noida, Lucknow, Dwarka and Nagpur units respectively. Revenue growth from existing units were at 13% YoY. Institutional revenue share was at 20.8%. Max Lab and Max@Home revenue stood at Rs 460mn and Rs 560mn respectively. During Q4, net debt decreased by Rs. 320mn QoQ to Rs15.8bn.
- Key con-call takeaways: Expansion plans- Three new brownfield towers at Max Smart, Nanavati, and Mohali (combined ~1,500 additional beds) will be operational over the next 3 months, with the Gurgaon greenfield facility on track for completion by FY26 end. Dwarka (303 beds): Newly operationalized asset light unit reported Rs 1.71bn of revenues and Rs 290mn of EBITDA loss for FY25. An additional 68 beds are set to be operationalized, with plans to expand further by 200 beds. Plans to commission Onco block in Q3FY26. Jaypee Noida: Reported Rs 2.28bn in revenue with a 21% EBITDA margin. Further margin expansion is expected through benefit from higher ARPOB and utilization. Lucknow (Phase 2): Added 128 beds on 9-12 floors through internal configuration along with 35 bed addition was done in May and plans to add another 39 beds in a year. Mgmt plans to add Onco block by Q2FY26
Fortis Healthcare’s (FORH) Q4FY25 EBITDA at Rs4.36bn; up 14% YoY was in line with our estimates. Though hospital margins improved by 170bps/190bps YoY in FY24/FY25, we see further scope for improvement aided by 1) improving case and payor mix, 2) cost rationalization initiatives including divestment of Richmond unit in Bangalore, ramp up of Manesar unit and 3) new brownfield bed additions. Fortis consolidated 89.2% stake in Agilus in Jan’25. We expect margins and revenue growth to further pick up from FY26 in Agilus.
Our FY26E and FY27E EBITDA stands marginally increased by 1-2%. We expect EBITDA to clock 21% CAGR over FY25-27E. At CMP, the stock is trading at 23x EV/EBITDA on FY27E, adjusted for Agilus stake. Maintain ‘Buy’ rating with revised TP of Rs785/share, valuing the hospital segment at 27x and diagnostic at 25x EV/EBITDA on FY27E.
Higher ARPOB; occupancy improved by 200 bps QoQ to 69%: Hospital business revenue increased 14% YoY (5% QoQ) to Rs17bn, vs our estimates of Rs16.7bn. Diagnostic business net revenue grew 3% YoY to Rs3.1bn. Hospital occupancy inclined to 69% vs 67% in Q3 and Q3FY24. ARPOB further improved by 8% YoY to Rs68.8k largely driven by improved case mix.
Strong show across segments: FORH’s consolidated EBITDA increased 14% YoY (16% QoQ) to Rs4.36bn, in line with our estimates. Hospital business EBITDA came in at Rs3.72bn, up 12% YoY; we estimated at Rs 3.6bn. Overall hospital OPM improved by 190 bps QoQ to 21.9%. The YoY decline in margins due to commercialization of Manesar unit and also Q4FY24 had certain positive one offs. Diagnostic business EBITDA increased 34% YoY to Rs630mn, with OPM of 20.6%. Adjusted for Rs. 190mn (vs 240mn in Q3FY25) of one-off expenses relating to rebranding, margins were at 26.8% vs 23.9% in Q3FY25. Net debt increased by Rs10.3bn QoQ to Rs16.9bn. There were Rs536mn one time impairment charges taken related to Ludhiana and Sri Lanka assets in Q4FY24.
Key con-call takeaways: Bed expansion: Overall ~2k bed expansion plan for FY26-29E. Mgmt plans to add ~1,000 beds at Noida, Faridabad, Jalandhar, FMRI, BG Road in FY26. FORH operationalized 60 and 20 beds at Noida and FMRI units in Q1FY26. Out of the total greenfield 350 beds in Manesar, FORH commercialized 90 beds as of Q4 and plans to add another 120 beds once occupancy ramps up. Expect to break-even by H1FY26. Jalandhar Acquisition: FORH to finalize the deal to acquire 228 beds (potential to expand to 450 beds capacity) in FY26 which will enhance Punjab cluster capacity from 800 beds to ~1,600 beds (including Mohali & Amritsar expansions). Capex: Total capex incurred at Rs 7bn for FY25. ARPOB: growth guidance continues to be at 5-6% YoY. Occupancy– Management aiming at 70-72% occupancy levels for FY26 and Q1FY26 occupancy trend is healthy and similar to Q4. Guided to continue improving operational efficiencies ed by bed expansions, better case mix, and patient demand. Margin guidance- Hospital margin guidance of 150-200 bps YoY improvement to 22-22.5% while guided for diagnostic margins at ~23%; respectively for FY26. Escorts, Jaipur, Vashi are underperformers being restructured; not factored into margin guidance. Drivers for hospital margins: Hospital margins to improve on ramp up in brownfield expansion, full-year benefit of cost efficiencies, improved case mix, scale up in digital revenues and ramp up in occupancies through scaling operations in underperforming hospitals (e.g. Escorts, Jaipur, Vashi). Fortis brand acquired Rs2bn; will eliminates 0.3% EBITDA drag (FORH was paying 0.25% + GST as royalty) from FY26. Agilus: No further on-off cost-related branding expenses from FY26. B2C:B2B mix was at 51:49. Legal Costs: 1% EBITDA impact; expected to normalize post FY26.
We increase our FY26E/FY27E PAT estimates by 13%/10% as we fine tune our yield and fuel CASK assumptions. INDIGO reported better than expected performance with FX adjusted EBITDAR margin of 30.8% (PLe 28.5%) led by 1) 2.2% rise in yield to Rs5.32 aided by Maha Kumbh and 2) 6.6% fall in fuel CASK to Rs1.60 amid benign ATF prices. Notwithstanding near-term challenges amid the ongoing geo-political tensions, ASKM growth guidance of mid-teens for 1QFY26E is encouraging. Further, we expect the overall pricing environment to remain stable with yields of Rs5.1 over next 2 years as the aviation market is now a duopoly with limited threat of predatory pricing. Plans to deepen international penetration (ASKM share to rise to 40% by FY30E), strategic focus on ization (“Indigo Stretch” already launched on 5 routes with 16 aircrafts) and subsiding AoG count will act as key growth and margin levers. We expect sales/EBITDAR CAGR of 15%/12% over FY25-FY27E and retain BUY on the stock with a TP of Rs6,084 (11x Sep-26E EBITDAR). Excess FX and ATF volatility is a key risk to our call.
Revenue up 24.3% YoY: Revenue increased 24.3% YoY to Rs221.1bn (PLe Rs217.8bn). enger revenue increased 25.4% YoY to Rs195.7bn, while ancillary revenue increased 25.2% YoY to Rs21.5bn. Load factor stood at 87.4% (PLe 88.4%), while RASK was at Rs5.26. ASKM/RPKM was up 21.0%/22.7% to 42.1bn/36.8bn. Fuel CASK decreased 6.6% YoY to Rs1.60. Yield increased 2.2% YoY to Rs5.32 (PLe Rs5.19). Total fleet count stood at 434.
PAT at Rs30.7bn: EBITDAR increased 58.8% YoY to Rs69.5bn (PLe Rs62.1bn) (FX adjusted EBITDAR was Rs68.2bn) with a margin of 30.8% (PLe 28.5%). PAT increased 61.9% YoY to Rs30.7bn (PLe Rs28.9bn) (FX-adjusted PAT was Rs29.3bn).
Key takeaways: 1) 3 domestic and 7 international destinations have been added during the year. 2) Amid geo-political tensions, operations across 11 airports were suspended for 8 days in May leading to a cancellation of 170 daily flights. 3) Share of international ASKM stood at 30% in FY25. It is expected to touch 40% by FY30E. 4) Indigo has signed an agreement to damp lease 6 aircrafts from Norse Atlantic with plans to lease 5 more in 2HFY26. 5) Launched “Indigo Stretch” on 5 routes so far with 16 aircrafts with plans to extend it to 40 aircrafts 6) AoG count is in 40s. 7) Inducted 67 aircrafts during the year. 8) Purchased 2 ATR aircrafts (owned count is 8) in 4QFY25. 9) ASKM growth is likely to be in early double-digits in FY26E. 10) Around 19 routes and 34 flights have been impacted due to closure of Pakistan’s airspace. Flights to 2 destinations have been suspended. Indigo operates 2,200 daily flights and prima facie the impact from air-space closure appears limited. 11) As a policy, Indigo plans to hedge the cash outflows falling due in next 12 months after ing for the natural hedge coming from international operations. 12) The aircraft engine and lease rental cost is expected to decline as damp leases would fall amid reduction in AoG count.