Apollo Hospitals Enterprise vs Fortis Healthcare Q3 FY26

Apollo Hospitals delivered a strong Q3 FY26 with consolidated revenue of INR 6,477 crore (+17% YoY) and PAT of INR 502 crore (+35% YoY), driven by double-digit growth across all verticals. Healthcare services revenue grew 14% to INR 3,183 crore, supported by 5% volume growth, 5% pricing, and 4% case mix improvement. Apollo Healthco revenue rose 20% to INR 2,827 crore, with digital losses narrowing to INR 67 crore. AHLL EBITDA grew 39% to INR 48 crore. Management guided for INR 150 crore in new hospital startup costs next year, partially offset by 100 bps margin expansion in existing hospitals. The digital business cash EBITDA breakeven is delayed by one quarter to Q1 FY27 due to insurance revenue recognition changes. Risk: new bed ramp-up may pressure near-term margins if occupancy lags.

Guidance read

New bed additions of ~1,500 over next two years: Approximately 1,500 new beds will be added across four new hospitals, with ~50% operationalized in FY27 and balance in early FY28. Startup losses of INR 150 crore in FY27: Management expects total startup losses of INR 150 crore from new hospitals in FY27, with potential quarterly peaks of INR 50 crore. Digital business cash EBITDA breakeven delayed to Q1 FY27: Cash EBITDA breakeven for Apollo 24/7 pushed out by one quarter to Q1 FY27 due to insurance revenue recognition changes. Existing hospital margin expansion of 100 bps in FY27: Management expects 100 bps margin improvement in existing hospitals next year through asset utilization and cost optimization.

Risk read

Key risks include New hospital ramp-up delays and cost overruns — Gurugram hospital delayed by 2-3 months due to environmental clearance issues; startup losses could exceed INR 150 crore if occupancy ramps slower than expected.; Insurance contract renegotiation delays — Some insurance contract renewals have been pushed out, potentially impacting revenue mix and ARPP growth in certain markets.; Digital business revenue recognition changes — Changes in GST and insurance commission recognition caused a INR 7 crore revenue deferral in Q3, delaying cash EBITDA breakeven by one quarter.; Talent poaching risk in competitive market — Recent poaching of a star oncologist by a peer highlights retention risk, though management believes Apollo's brand and platform mitigate this..

Promise ledger

Of 3 tracked promises, management 0 met, 0 close, 3 missed.

FO

Fortis Healthcare

Q3 FY26 · Healthcare

Fortis Healthcare delivered a strong Q3 FY26 with consolidated revenue of ₹2,265 crore (+17.5% YoY) and EBITDA margin expansion of 290 bps to 22.3%, driven by hospital business growth of 19.4% and diagnostics margin recovery to 23.1%. PAT declined to ₹197 crore due to a one-off expense of ₹55 crore for new labor codes. Hospital occupancy remained steady at 67%, while ARPOB grew 4.5% to ₹2.56 lakh, supported by a 52% surge in robotic surgeries. The diagnostics business saw 8.3% revenue growth and a 870 bps margin improvement. Management guided for continued growth trajectory with brownfield expansion of ~400 beds in FY27, led by the fMRI facility. The People Tree acquisition in Bengaluru adds 125 beds with expansion potential to 300. Risks include integration challenges at Glenagles and potential dilution from IHH's planned equity infusion.

Guidance read

Brownfield bed addition of ~400 beds in FY27: Major contribution from fMRI expansion (200+ beds) to be commissioned in phases starting April 2026. ARPOB growth of 4-5% annually for next 2 years: Driven by ~2.5% price increase and balance from case mix improvement, especially in oncology. Continued margin improvement trajectory for at least 2 years: Supported by brownfield expansions in high-margin facilities like fMRI and operational leverage. Potential equity infusion by IHH within 3-6 months: Preferential allotment likely after cooling period ends in May 2026, to strengthen balance sheet for growth.

Risk read

Key risks include Glenagles integration challenges — Revenue declined 4% in 9M FY26 due to management changes and operational issues; turnaround expected only from next fiscal.; Intense competition in Hyderabad cluster — Management expressed caution about Hyderabad due to competitive intensity, though it remains a focus cluster.; Execution risk in People Tree ramp-up — Acquired hospital is suboptimal and requires investment; expansion to 300 beds may take 30 months due to Bangalore approval delays.; CGHS/ECHS rate hike benefits uncertain — New circulars have implementation ambiguities; full benefit may be delayed until clarity on super-specialty rates and drug pricing..

Promise ledger

Scorecard data is being built as historical quarters are processed.