Jupiter Life Line Hospitals · tone and specificity signals across the available quarters.
Language signals
The gap between PAT and EBITDA is expected to widen leading to lower PAT margins this year. The capex incurred in the last year including the 100 new census beds, the new OTs, biomedical enhancements that is the surgical robots, MRIs, cath labs, etc. have increased the depreciation load by over 10 crores this quarter compared to the same period last year.
First year Dombivli should have negative EBITDA to some number. While on the individual strength, the three hospitals will continue performing in line as they should, but on a consolidated level next year there should be some compression on account of Dombivli.
All the hospitals we expect the peak to be in the mid-70% range. In absolute terms, the occupancy is higher by about 5% compared to last year.
We expect that we should broadly be able to complete with our resources and future internal approvals. This debt might kick in if we need or if we get an opportunity to do one more project.
New hospitals are expected to be EBITDA negative in the first year and break even in the second year. That is our general observation and expectation.
In early years of a hospital, you generally do more primary and secondary work and less of tertiary work. Because of early years, we should definitely expect a slightly lower ARPOB in Doiwali than we see in matured hospital.
Healthcare cannot be monitored on quarter to quarter. Each hospital has finite capacity. Very soon I would hope that all the mature hospitals are able to report zero growth because they are already at maturity. So the growth eventually comes from new and upcoming hospitals where you start from zero.
On Pune South: 'Construction is begun. We have just started the basement work. As we have said, we are slated to begin it sometime in calendar year 28 and we are reasonably sure to achieve that target. Capex so far maybe less than 50 crore so far.'
On margin trajectory: 'How the macroeconomics will play out? How the wages will happen over the next several years? What will be the impact of GST? How will taxation play out? Too much of astrology is difficult to do.' - declining to provide specific long-term margin guidance.
We are not trying to just grow fast. We are trying to grow right. Every project in our pipeline is greenfield. Each one is designed as a fullscale hub. Not a spoke, not a satellite, but a flagship facility in its own right.
Our internal accruals that we'll generate over the next five years along with some debt as I said with a currently self-imposed ceiling of three times EBITDA, we believe that a combination of these two should take us through the line of everything including BKC.
The only thing that I'm watching out for very keenly is the depreciating rupee and the cost of capex. So that is kind of a national reality. If the situation does not come under good control, it threatens to really balloon.