Delhi Master Plan 2047 puts brokerages' spotlight on Max, Fortis, Medanta

For hospital operators, a Jefferies note said the MPD introduces several measures that could improve asset productivity and enable higher capacity creation in land-constrained areas.

Delhi’s healthcare infrastructure could see a significant boost under the Master Plan Delhi 2047 (MPD), according to brokerages, which aims to strengthen the city’s healthcare ecosystem by promoting an integrated network of hospitals, medical colleges, specialty healthcare facilities, and wellness centres.

 

The MPD, according to a note by Jefferies, augurs well for NCR-focused operators such as Max, Fortis, and Global Health, which operates the Medanta chain of hospitals. It maintained a 'buy' rating on all these stocks with an upside potential of up to 23 percent from current levels.

 

Besides Jefferies, analysts at PL Capital, too, have a positive view on Global Health, and expect the stock to rally around 19 per cent from the current levels to Rs 1750.

 

Productivity boost

 

For hospital operators, the Jefferies note said the MPD introduces several measures that could improve asset productivity and enable higher capacity creation in land-constrained areas.

 

A key provision, according to them, is the removal of height restrictions for healthcare facilities, subject to approvals, in line with the revised National Building Code (NBC) provisions. 

 

“Higher Floor Area Ratio (FAR) norms and the development of High Density Corridors (HDCs) could further support denser hospital projects. These measures are expected to lower land costs per bed and improve the long-term productivity of hospital assets,” wrote Alok Dalal and Dhawal Khut of Jefferies in a recent note.

 

Improved regional connectivity, analysts said, could also widen hospital catchment areas and increase patient throughput from surrounding regions. At the same time, the creation of serviced greenfield land and higher FAR norms around transit nodes, Jefferies said, could enable larger, high-density hospital developments, improving project viability.

 

However, the direct impact of MPD-2047 will be limited to the National Capital Territory (NCT) of Delhi. The plan does not govern Gurugram in Haryana or Noida and Faridabad in Uttar Pradesh, which are covered by separate state master plans. 

 

 

“The impact, therefore, is likely to be strongest for hospital assets located within Delhi. However, large hospital clusters in Gurugram and Noida could benefit indirectly through improved regional connectivity and wider referral catchments,” Dalal and Khut wrote.

 

Among hospital companies under Jefferies' coverage, facilities of Medanta, Max, Fortis and Apollo — including Apollo’s upcoming facility — are likely to benefit from these developments in the wider Delhi-NCR region.

 

Max and Medanta, it said, have the highest upcoming bed additions in Delhi-NCR over the next four to five years. Max is expected to add 2,108 beds, representing a 55 per cent increase over its existing capacity. Medanta, meanwhile, is expected to add 1,267 beds, or 68 per cent of its current capacity.

 

Earnings trajectory

 

Medanta’s earnings trajectory could also strengthen as its operational challenges ease, according to analysts at PL Capital. The hospital chain reported moderate earnings before interest, tax, depreciation, and amortization (EBITDA) growth of 7 percent compounded annually during FY24-26, PL Capital said, primarily due to issues at its Lucknow unit and start-up losses related to its Noida facility in FY26. 

 

With the issues at Lucknow largely resolved and a visible ramp-up at Noida, PL Capital expects Medanta’s EBITDA to grow at around 24 per cent CAGR between FY26 and FY29. At the current market price, the stock trades at 24 times FY28 estimated EV/EBITDA and 21 times FY29 estimated EV/EBITDA.

 

PL Capital has a ‘buy’ on Medanta with a target price of ₹1,750 per share, valuing the company at 28 times EV/EBITDA based on September FY28 estimates.

 

Himanshu Binani and Anubhav Sangal of Anand Rathi expect Max's revenue and EBITDA to clock 18 percent CAGR each over FY26-28e, and maintain a ‘buy’ rating on the stock, valuing its hospital / laboratory business at 32/26x FY28e EV/EBITDA.