IHH Healthcare - Positive On International Medical University (IMU) Sale
- IHH Healthcare (SGX:Q0F) has entered into a definitive agreement for the sale of its medical education arm International Medical University (IMU) for RM1,345m. The sale also includes a hospital under construction, which is designated to be a teaching hospital for IMU. The deal is valued at 16.6x of IMU’s FY21 EV/EBITDA, and is expected to complete in 1Q23F, subject to relevant regulatory approvals.
- IHH Healthcare remains steadfast in executing its business strategy to grow its existing hospital clusters, with a greenfield hospital in Turkey slated to open in 2H22F, as well as ongoing due diligence to acquire business from Ramsay-Sime Darby that will both enhance IHH Healthcare’s Klang Valley cluster and expand into the Indonesian market.
- We think that current valuations for IHH Healthcare remain attractive, and its SOP-based target price of RM8.12 implies a forward EV/EBITDA of 16.2x, which is lower than its 5-year historical average of 19.2x.
- We like the deal as it allows IHH Healthcare to focus on investments in its core healthcare service businesses.
Above is the excerpt from research report by CGS-CIMB.
Clients of CGS-CIMB may access the full report in PDF @ https://www.itradecimb.com.sg/.
TAY Wee Kuang CGS-CIMB Research | https://www.cgs-cimb.com 2022-06-08 2022-06-08
Previous report by CGS-CIMB:
2022-05-27 IHH Healthcare - Confident Despite Oncoming Headwinds
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