Hospital stocks in demand; Narayana, HCG hit new high, Yatharth surges 6%

Shares of Hospital firms gained amid rising demand for specialized treatments, including oncology and high-end surgical procedures; this trend contributes to higher ARPOB and overall revenue growth.

Shares of listed hospital companies - Narayana Hrudayalaya, HealthCare Global Enterprises (HCG) and Yatharth Hospital & Trauma Care Services (Yatharth Hospitals) - were in demand, and up to 6 per cent on the BSE in Wednesday’s intra-day trade on healthy outlook. In the past three days, these stocks have rallied between 7 per cent and 16 per cent.

 

Today, Narayana Hrudayalaya (up 4 per cent at ₹1,807.40) and HCG (up 2 per cent at ₹586.35) hit their respective record highs. Yatharth Hospital & Trauma Care Services has surged 6 per cent to ₹512.85 in intra-day trade. In comparison, the BSE Sensex was down 0.10 per cent at 76,655 at 11:10 am. 

 

 

There is a rising demand for specialized treatments, including oncology and high-end surgical procedures. This trend is contributing to higher ARPOB (Average Revenue per Occupied Bed) and overall revenue growth.

 

According to analysts at Choice Equity Broking, healthcare companies under coverage are expected to end the year on a good note and continue in FY26. The brokerage firm anticipates its coverage companies to report robust double-digit growth in revenues (~21 per cent year-on-year (YoY) on average), considering one of the best quarter for the industry, primarily driven by improved occupancy levels due to the execution of elective surgeries, capacity expansions, and improvement in the share from international patients.

 

Accounting for ~5-7 per cent of revenue, medical tourism is expected to grow at nearly double the overall rate in the mid-term. Factors such as normalization in the geo-political issue, operationalization of a new airport in Noida, affordable treatment costs, world-class facilities, and skilled medical personnel will continue to attract international patients, particularly from Southeast Asia and the Middle East, analysts said.

 

Among individual stocks, HCG is a pioneer in cancer care in India and has established itself as an important healthcare provider in the country for the past three decades. On February 23, 2025, KKR, a leading global investment firm, and HCG announced the signing of definitive agreements with CVC, a leading global private markets manager, under which funds managed by KKR will become the largest shareholder in HCG and assume sole control of HCG’s operations. 

 

As part of the transaction, KKR will acquire up to 54 per cent of equity in HCG from CVC Asia V at a purchase price of ₹445 per share.  KKR to purchase additional equity shares in HCG from public shareholders for the acquisition of 26 per cent of the share capital, at ₹504.41 per share. Upon completion of the transaction, KKR is expected to hold an equity stake of between 54-77 per cent.

 

Narayana Hrudayalaya is one of the leading healthcare service providers in India, operating a chain of multispecialty, tertiary, and primary healthcare facilities. The company has a network of 19 hospitals and 2 heart centres across India, along with overseas presence at Cayman Islands, with over 5,900 operational beds and a capacity of over 6,300 beds.

 

Thus far in calendar year 2025, Narayana Hrudayalaya has outperformed the market by surging 42 per cent on the back of strong earnings. In comparison, the BSE Sensex has declined 2.3 per cent and the BSE Healthcare index down 9 per cent during the same period. The company's management remains confident that the new hospital will become a strong engine of growth in Cayman over the next few years.

 

Yatharth Hospitals is one of North India’s leading healthcare providers, operates five super specialty hospitals located in North India, i.e. at Noida, Greater Noida, Noida Extension and Faridabad in Delhi NCR, and Jhansi-Orchha in Madhya Pradesh. 

 

The stock price of the company has recovered 49 per cent from its 52-week low of ₹345.35 touched on March 3, 2025. It had hit a 52-week high of ₹692.85 on November 4, 2024.

 

Analysts at Axis Securities anticipate the healthcare sector to register revenue growth of 20.7 per cent YoY while it is expected to decline by 2.8 per cent quarter-on-quarter (QoQ). This would be largely driven by an expected improvement in occupancies of up to 100 bps and ARPOB growth of 7-8 per cent.

 

Despite a soft quarter in healthcare, HCG could report healthy topline growth driven by contributions from the Vizag hospital. Occupancies are likely to be improved by 300bps on YoY and ARPOB to grow by 8 per cent and expected EBITDA to be improved, driven by top-line growth.