Brokerage 'buy' call lifts Apollo Hospitals

Apollo Hospitals Enterprises rose 2.92% to Rs 1,017.85 at 14:10 IST on BSE on reports a foreign brokerage issued a 'buy' rating on the stock.

Meanwhile, the BSE Sensex was up 292.22 points, or 1.15%, to 25,808.57.

On BSE, so far 16,000 shares were traded in the counter, compared with an average volume of 17,554 shares in the past one quarter.

The stock hit a high of Rs 1,025 and a low of Rs 993.55 so far during the day. The stock hit a 52-week high of Rs 1,042.90 on 10 June 2014. The stock hit a 52-week low of Rs 802 on 20 August 2013

The stock had outperformed the market over the past one month till 1 July 2014, rising 8.89% compared with 5.36% rise in the Sensex. The scrip had, however, underperformed the market in past one quarter, rising 9.20% as against Sensex's 13.68% rise.

The large-cap company has an equity capital of Rs 69.56 crore. Face value per share is Rs 5.

The brokerage reportedly said in a note that aggressive ramp-up has resulted in lower margin for the year ended March 2014 (FY14) and that it expects a pick-up in growth from the year ended March 2015 (FY15) as a result of the move.

Apollo Hospitals Enterprises looks well set to achieve over 20% topline growth and 80-100 basis points EBIDTA margin expansion every year over the next few years, the brokerage reportedly said.

The brokerage is further reported to have said that Apollo has funded over 70% of its capital expenditure internally over the last three years, up from 21% in the year ended March 2008. Net debt/equity seems comfortable and that this greater comfort on funding has allowed the company to shift a gear up and step up investment for longer-term growth.

Apollo Hospitals Enterprise's net profit rose 7.7% to Rs 81.34 crore on 17.86% growth in total income to Rs 1005.21 crore in Q4 March 2014 over Q4 March 2013.

Apollo Hospitals is one of Asia's largest healthcare groups.

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