Stock market investment tip: This pharma stock is the best bet on Dalal Street - Know why
This stock not only is a chain of multi-specialty hospitals heart centres, and primary care facilities but also a potential money-making capital.
We all grew up with the famous saying 'health is wealth'. Surely, no one told you that putting your money in the health sector could you procure good wealth. Well, this stock not only is a chain of multi-specialty hospitals heart centres, and primary care facilities but also potential money-making capital. Narayana Hrudayalaya is a network of hospitals in the country and also has branches overseas.
Founder and Chairman Dr. Devi Prasad Shetty says the hospital aims to provide affordable yet quality medical services for the broader population of the country. He also mentions that it is this exciting prospect to establish low-cost yet high-quality healthcare facilities that stoke his motivation to do bigger and better for the country.
The hospital chain on Wednesday was trading at Rs 229.50 per piece, up by Rs. 4.65 or 2.07%. The stock has grown by 2.29%, after getting an intraday high of Rs 230.
ICICI Securities has put down the below-mentioned reasons why this hospital will be a good stock to buy:
1. Narayana Hrudayalaya (NHL) has 24 hospitals (including three managed hospitals), seven heart centres, 19 primary care facilities (including clinics and information centres) and a multi-specialty hospital in Cayman Islands.
2. NHL has a legacy model based on affordability supported by strict control over costs and capital.
3. However, as it looks to scale up in other regions, where the consideration for quality has more weight than affordability, the model is likely to be modified from "affordable" to a mix of affordable + quality at a premium.
4. The company follows an “assets light model”. Under this, the company engages with partners who invest in land and building while it takes care of medical equipment and hospital management on a revenue share basis. This is why NHL’s balance sheet is one of the lightest among peers. However, the management has maintained a flexible approach in this regard. Thus, it also owns some hospitals where the opportunity is right.
5. We remain positive on the stock as we believe the long term prospects remain intact on the back of asset-right model and affordability philosophy.
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