Aster DM Healthcare has announced the merger with Quality Care India Limited (QCIL), creating one of India’s top three hospital chains with over 10,625 beds. The merger, approved by the board, will result in a new entity named Aster DM Quality Care Limited. This strategic move aims to enhance diversification, unlock synergies, and offer improved healthcare services across South and Central India. The transaction is expected to be EPS accretive from the first full year of operations.
Strategic Merger Overview
Aster DM Healthcare’s board has approved the merger with Quality Care India Limited, marking a significant consolidation in the Indian healthcare sector. This merger will establish Aster DM Quality Care Limited as a leading hospital chain in India.
Financial & Operational Impact
The merged entity boasts over 10,625 beds and combined revenue of INR 8,105 Cr. The transaction values Aster at 36.6x FY24 Adj. Post INDAS EV/EBITDA. Synergies are expected in revenue, procurement, supply chain, and corporate functions, with a near-term EBITDA upside potential of 10-15%.
Leadership and Governance
The promoter group and Blackstone will maintain equal representation on the board. Dr. Azad Moopen will continue as Executive Chairman, with Mr. Varun Khanna and Mr. Sunil Kumar to be promoted to MD & Group CEO and Group CFO, respectively. The merger is subject to necessary approvals and is expected to complete by Q1FY27.
Performance Highlights
The combined entity shows a revenue growth of 15% YoY. Total Patient Volumes grew by 9% YoY in Q3FY26. The EBITDA margins are at 21%. The entity aims to add 4,080+ beds to bring the total bed capacity to 14,710+ beds.
Strategic Priorities
Key strategic priorities include:
- Investing in both brownfield and greenfield projects.
- Enhancing efficiency and lowering operational expenses.
- Leveraging technology for superior patient outcomes.
Source: BSE
