Max Healthcare delivered its 21st consecutive quarter of year-on-year growth for Q3 FY’26, with network gross revenue increasing by 10% YoY to INR 2,608 crore. Operating EBITDA grew 4% YoY to INR 648 crore, though the margin compressed to 26.1% due to seasonal softness and payer mix changes. The company continues aggressive capacity expansion, including a new hospital planned in Pune.
Q3 FY’26 Performance Overview
Max Healthcare Institute Limited reported its results for the third quarter and nine months ended December 31, 2025. The Network achieved its 21st consecutive quarter of year-on-year growth in Q3, despite seasonal softness and external factors.
- Revenue increased by 10% year-on-year, reaching INR 2,608 crore.
- Operating EBITDA grew 4% year-on-year to INR 648 crore.
- Average occupancy for the Network stood at 74%.
- Average Revenue Per Occupied Bed (ARPOB) was INR 77,900, a 3% year-on-year growth.
- Profit After Tax (PAT) was INR 344 crore (after exceptional items of INR 55 crore).
Margin and Revenue Influencers
The management noted several factors impacting sequential performance and margin compression:
- Operating EBITDA margin was 26.1%, down from 27.3% in Q3 FY’25, primarily due to payor mix change, pre-commissioning expenses for brownfield beds, and GST rate changes.
- A temporary shift towards institutional patients due to disruption in cashless services with stand-alone health insurers affected sequential results until restored late in the quarter.
- Performance was also affected by the discontinuation of select high-value patented chemotherapy drugs following revised CGHS pricing guidelines.
Management stated they are in discussions with CGHS regarding tariff revisions, seeking a cost-plus basis for supplying drugs where current margins are below 20%.
Capacity Expansion and Strategic Moves
The company highlighted significant progress in network capacity enhancement:
- Brownfield Additions: 63 beds were commissioned at Nanavati Max (45 occupied) and 53 beds at Max Mohali (46 occupied). These incremental capacities are already EBITDA and margin accretive.
- New Geographic Presence: An important step was taken to develop a 450-bed hospital in Pune by 2030.
- Max Dwarka Expansion: The Board approved an addition of 260 beds at the existing site, taking total capacity to 560 beds. The current 300-bed facility is already operating at close to 75% capacity.
- Max Smart (Gurgaon): Infrastructure for about 200 beds is ready, awaiting occupancy certification expected by the end of February.
Looking ahead, the first phase of the Gurgaon project is expected to commission towards the end of H1 FY’27. The company expects to reach around 6,000 operational beds by FY’28, with a long-term target of 8,000 beds.
Nine Months Performance (9M FY’26)
For the nine months ended December 2025:
- Network gross revenue was INR 7,874 crore, reflecting a strong 19% year-on-year growth.
- Overall Network operating EBITDA grew 16% year-on-year to INR 1,956 crore, with a margin of 26%.
- Free cash flow generated was INR 960 crore.
- Net debt stood at INR 2,166 crore, with the net debt-to-EBITDA ratio remaining less than 1.
Insurance Renewals Update
Regarding recent disruptions with insurance partners, management confirmed that the issue was restored. A new mechanism for annual increments is now in place, replacing the previous cycle-based negotiations, though this applied only to the four companies involved in the prior stalemate.
Source: BSE
