IHH Healthcare - RHB Invest 2023-09-01: Growth To Be Anchored By Inorganic Expansion

• Despite a sequentially softer 2Q23, IHH Healthcare’s growth should be mainly driven by M&A, a pick-up in medical tourists in its core markets, and inelastic consumer demand for healthcare services.
• We still like IHH for its solid execution strategy and reputable regional footprint across key regions, driven by strong brand awareness and an affluent client base.
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Key takeaways from post-results briefing

• We emerged from IHH Healthcare (SGX:Q0F)’s post-results briefing feeling positive, as we like its M&A strategy to drive long-term growth.
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• IHH's net gearing ratio is healthy at 0.29x, providing ample balance sheet headroom to fund future acquisitions.
• Despite a seasonally weaker quarter in 2Q23 (due to Aidil Fitri and the Turkey presidential election), management remained upbeat on the prospects going forward, underpinned by Turkey’s more stable political landscape, robust patient traction in Malaysia and Singapore, and inorganic growth opportunities ahead.

Easing concerns on nursing shortage.

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Oong Chun Sung RHB Securities Research | https://www.rhbgroup.com/ 2023-09-01 SGinvestors.io

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