Krishna Institute of Medical Sciences · tone and specificity signals across the available quarters.
Language signals
We are exploring more opportunities but the focus area and the clusters remain the same. More work in Karnataka, Kerala, Maharashtra and obviously a lot of greenfield brownfield edition in Telangana and AP. But our intent is to first stabilize a lot of the greenfield hospitals that got commissioned this year or will get commissioned this year.
There's no capex commitment from our side on these O&M assets. We have full control over the P&L, the hospital operations, the clinical talent hiring, all of that is under the scope of KIMS. We manage the entire hospital for the promoters and we take a certain share of the revenue.
I think anywhere in the 22 to 25% range is what we're looking at [for FY26 margins]. Beyond Q2 of next financial year, we have no greenfield assets that are getting commissioned. So we don't see these losses continuing beyond up until FY28-29 when we look at more green hospitals that come.
We have commissioned almost four-five new hospitals which are yet to break even and because of which the revenue ramp up in those hospitals are happening but haven't reached a bit break even. So that is why there's a drag on the EBITDA.
Most of these hospitals got commissioned in the last 10 months. And the first year typically goes in kind of reaching a break even point and then it'll take time for them to reach a double digit margin. So definitely the delta is there but it will take a good number of quarters before we are able to bring it to a corporate level margin.
Unlike what is happening in Thane and in Bangalore, 35-40% of the hospital business in this cluster comes from CGHS and related parties. For empanelment of CGHS and related parties you need something called a 172B license which typically takes time even historically in AP and Telangana it has taken us at least 9 months to one year after the hospital gets commissioned.
This is a record-breaking quarter with highest ever revenue crossing the 1,000 crore. Though Q3 is traditionally a weak quarter, we have raced past with growing results despite the usual initial pressures associated with the new units.
Between Thane and Mahadevapura, towards the end of Q1 next financial year we should become EBITDA positive or EBITDA neutral. Electronic City might take a little longer by May because we commissioned it only in the month of December.
In a tier 2 market you have a mix of cash, insurance and corporate. Insurance and corporate because they take time and it's a very price-sensitive market. That is why the delayed ramp up. But otherwise fundamentally we don't see any issue in Thane or Bangalore.
The idea is now that the debt has reached its peak close to 3,000 plus crores the idea is we retire some debt and use the cash flow to do more green field projects which anyways will take three to four years before they get commissioned.
What we underestimated is the time it takes to now get insurance empanelments vis-a-vis how it was before. That has caused some delay in ramp up but otherwise overall we're very happy with all the four hospitals.
Had we got empanelments like we could have in the past the ramp up would have significantly been better than what it is today.
For the matured unit we continue to do about 29 and a half percent margin on the overall base which we continue to do for these mature units.