- Downgrade Raffles Medical to NEUTRAL from BUY with S$1.15 target price from S$1.75 as below expectation results could persist beyond 3Q23.
- While longer-term growth in China seems promising, we earlier expected the gestation losses from China to be offset by improving Singaporean operations. However, the Singapore weak margins amid higher operating costs, elevated insurance claims, and a lower foreign patient load would likely persist.
- - Read this at SGinvestors.io -
Disappointing 3Q23 business update.
- Raffles Medical (SGX:BSL)'s 9M23 revenue of S$532.4m (-14.7% y-o-y) accounted for 67% of our earlier 2023 estimate, while the PAT of S$72.8m (-25.6% y-o-y) accounted for 60% of our earlier 2023 estimate.
- - Read this at SGinvestors.io -
- higher insurance claims;
- weaker than expected volume and margins for the Transitional Care Facility (TCF); and
- slower than expected ramp up in China hospital operations.
Margins in Singapore to remain weak.
- Read more at SGinvestors.io.
