The brokerage has a target price of ₹1,100, implying an upside of around 19% from the previous close. In its bull case scenario, it sees the stock rising to ₹1,260, indicating a potential upside of 36%.
Motilal Oswal said that following the change in promoter ownership to IHH Healthcare in FY19, Fortis has transitioned into a professionally managed healthcare platform.
This shift was supported by balance sheet clean-up and the exit from non-core businesses.
The company’s financial performance has improved significantly over the years, with revenue and EBITDA rising from ₹4,500 crore and ₹200 crore in FY18 to an estimated ₹9,000 crore and ₹2,050 crore by FY26, alongside a return to profitability.
EBITDA has grown at a CAGR of 33%, driven by capacity expansion and operational efficiencies. Strong internal accruals are now supporting the addition of 400-500 beds annually.
The brokerage also referred to a recovery in Agilus Diagnostics, with growth and margins showing improvement. It expects EBITDA and PAT to grow at a CAGR of 17% and 22%, respectively, over FY26-FY28.
Motilal Oswal has valued the hospitals business at 30x EV/EBITDA and diagnostics at 23x, in line with peers such as Max Healthcare and Apollo Hospitals, citing strong execution, brownfield expansion and improving return ratios.
Shares of Fortis Healthcare were trading 0.30% lower at ₹923.95. The stock has gained about 3% so far this year.
