Yatharth Hospital & Trauma Care Services — Deep Dive Analysis

Yatharth Hospital & Trauma Care Services — Deep Dive Analysis

Analysis date: 8 October 2026 | CMP: ₹1,014.20 | Model: deepseek-v4-flash (DeepSeek) | Data: Screener.in consolidated, NSE filings, NSE bhavcopy, Yahoo Finance, Tavily research

Yatharth is a genuine growth story — revenue up 52%, a 5,000-bed roadmap, and now a ₹3,150 crore investment from Advent International. But the profits are not following the revenue, the Advent money dilutes existing holders by a third on a fully diluted basis, and the stock trades above the average analyst price target. This is a business worth owning at Advent's entry price, not above it.

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1. Quick Snapshot

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2. Business Overview

Yatharth Hospital & Trauma Care Services Ltd, founded in 2008 by Dr. Ajay Kumar Tyagi and Dr. Kapil Kumar, is a Noida-based super-specialty hospital chain focused on Delhi NCR and contiguous markets. It listed on the exchanges in July 2024.

Network (nine hospitals, announced capacity ~3,250 beds):

Accreditation matters in this business: the Greater Noida super-specialty hospital holds Joint Commission International (JCI) accreditation and the group carries NABH accreditation — a genuine differentiator for attracting international and insurance-funded patients. The group employs 7,440 people.

How the company makes money: inpatient and outpatient tertiary and quaternary care across cardiac sciences, neurosciences, oncology, orthopaedics, nephrology, critical care and trauma. The economics turn on three levers — beds, occupancy, and ARPOB (average revenue per occupied bed).

The strategy is buy-and-turnaround plus greenfield: acquire underperforming or under-construction assets in dense, high-income catchments, integrate them quickly, and lift occupancy and ARPOB. The evidence that this works is real — see Section 7.

One structural feature to understand: the group carries a hospital in Orchha, Madhya Pradesh alongside its NCR cluster. NCR hospitals achieve far higher ARPOB than the Orchha facility (₹50,000+ at the premium end vs a group average of ₹34,758), so the reported group ARPOB understates the quality of the NCR assets and overstates the maturity of the portfolio.

Disclosure note: the company's own Q1 FY27 call (August 2026) cited a network of 2,555 beds. By September-October 2026, press reports and the company's EGM materials describe nine hospitals with ~2,800 beds and announced capacity of ~3,250 beds. The difference reflects capacity added during the intervening weeks plus the acquisition of the Gurugram asset.

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3. Financial Performance

3.1 Annual P&L (consolidated, ₹ Cr)

Revenue has compounded at 34% a year from FY22 to FY26 and profit at a genuinely impressive rate. But note the margin trend: OPM has fallen from 30% (FY22) to 23% (TTM) as newer, immature hospitals dilute the mix.

3.2 Quarterly trend (consolidated, ₹ Cr)

3.3 Key takeaways — the central anomaly

Revenue grew 52% year-on-year in Q1 FY27 (₹258 Cr → ₹393 Cr) and the reported net profit was identical at ₹45 Cr — flat for five straight quarters.

This is not an accounting trick or a one-off. It is the arithmetic of the expansion:

• Depreciation has nearly doubled, from ₹15 Cr to ₹28 Cr a quarter, as acquisitions and completed capex arrive on the balance sheet (annual depreciation: ₹57 Cr → ₹88 Cr → ₹101 Cr TTM)
• Interest has gone from zero to ₹7 Cr a quarter as the company borrowed to fund hospital acquisitions — consolidated borrowings rose from ₹12 Cr to ₹264 Cr during FY26
• Operating margin has been stuck at 23% for four quarters, held there by the drag from immature hospitals plus a worsening payer mix (Section 7)

The company is right to point at cash profit, which rose 32% year-on-year (PAT plus depreciation). But the honest reading is that the P&L the market is capitalising at 54x earnings has not grown in over a year, and the gap between revenue growth and profit growth is the single most important thing to understand about this stock.

This is what the Advent capital is meant to fix — by funding the expansion off the balance sheet rather than through debt, it should eventually relieve the interest burden. It does not relieve the depreciation burden, which is the larger drag.

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4. Balance Sheet

What the balance sheet shows:

• Fixed assets more than doubled in FY26 (₹605 Cr → ₹1,250 Cr) — the acquisitions (Faridabad Sector 20, New Delhi Model Town, Agra) landing on the books
• Borrowings went from ₹12 Cr to ₹264 Cr to fund them. Debt/equity is still moderate at 0.15, and the company has guided that it will not take fresh loans — but interest cost is now a real ₹7 Cr a quarter
• Reserves of ₹1,684 Cr give a book value of ₹185/share and a P/B of 5.5x for a business earning 10.2% on equity
• CWIP fell from ₹222 Cr to ₹102 Cr as projects completed — the Gurugram facility is the main construction still in progress

The dilution that is coming: the Advent preferential issue adds ₹1,283 Cr of equity immediately (warrants add ₹1,867 Cr on exercise), which will lift equity capital and reserves substantially — and dilute existing holders by 33% on a fully diluted basis. See Section 11.

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5. Cash Flow

The good news is the quality of earnings: operating cash flow rose to ₹205 Cr in FY26, which is 94% of operating profit — up from a dismal 22% in FY24. This is a business that converts its reported profit into cash. For a hospital company carrying 113 debtor days (largely insurer and government receivables), a 94% conversion ratio is genuinely strong.

The awkward news is the shape of the whole statement: CFO of ₹205 Cr against investing outflow of ₹598 Cr. The company has been spending roughly three rupees for every one it generates to buy and build hospitals, funding the gap with debt and equity (₹254 Cr from financing in FY26, ₹509 Cr in FY25 — that was the QIP).

Free cash flow has been negative for three consecutive years. That is defensible for a company in a land-grab phase — hospital capacity, once built, generates cash for decades — but it means every growth rupee has so far been funded by someone else's money, and it explains precisely why the Advent deal matters.

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6. Shareholding Pattern

Screener's columns carry fiscal year-end labels; these are March year-ends.

Promoter holding has fallen from 66.54% to 55.80% in two years — a 10.7 percentage point decline. Screener flags this as a con. Two causes, and the distinction matters:

1. Dec 2024 (66.54% → 61.44%): dilution from the QIP. The company raised equity; promoters did not subscribe. This is dilution, not selling.
2. Dec 2025 (61.64% → 55.80%): a promoter sold in the open market. On 28 November 2025, promoter Neena Tyagi sold 56,33,800 shares — 5.8% of the company — for ₹403.93 crore at ₹716.98 per share. The stock fell 8.3% that day (some reports cite a 9.8% intraday drop to ₹696), closing below all key moving averages. She had held 6.47% as of September 2025, so this was very nearly her entire stake.

The buyers on the other side included genuine institutions — Kotak Mahindra Mutual Fund added 8,00,000 shares (0.83%) at ₹719.37, and Carnelian Asset Management bought 5,50,323 shares (0.57%) at ₹721.89. Alongside them sat high-frequency desks (Share India Securities, Graviton Research, Mansi Share & Stock Broking) running matched same-day buy/sell arbitrage.

How to read it: a promoter choosing to sell 5.8% in a single day at ₹717 — while the company was publicly guiding to a doubling of capacity and record growth — is the kind of signal that deserves to be weighed rather than explained away. It does not invalidate the business, and the promoter group as a whole remains the largest shareholder with 55.80%, but it is a real data point and the market punished the stock on the day for good reason.

FII/DII participation is modest and volatile (FIIs 5.62%, DIIs 10.84%) — this is a domestically-owned story where institutions have rotated in and out rather than accumulating steadily. The shareholder count rose from 50,113 to a peak of 99,117 before easing to 96,264 — a retail base that roughly doubled during the post-IPO period.

Promoter pledge: nil disclosed. The only promoter-related filings are routine annual Regulation 31(4) disclosures, and the company confirmed as of 31 March 2026 that promoters hold 5,37,62,672 shares with no new encumbrances.

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7. Capacity Pipeline & Revenue Visibility

Hospitals have no order book, so revenue visibility comes from beds, occupancy, ARPOB and the maturity curve of new assets. Here is the actual operating detail from the Q1 FY27 call (11 August 2026).

7.1 Segment behaviour — mature vs new

The newer hospitals contributed 27% of group revenue this quarter — up sharply, and the clearest evidence that the acquisition machine is producing.

7.2 Hospital-level operating metrics

The turnaround playbook is demonstrably working. Faridabad Sector 20 reached EBITDA breakeven in nine months — unusually fast for a hospital acquisition — and now runs a monthly revenue rate of ₹12-13 Cr with ARPOB approaching ₹40,000 and a path to ₹45,000-50,000. Agra delivered 20%+ EBITDA in its very first full quarter of integration. Both New Delhi and Noida Extension have crossed ₹50,000 ARPOB, placing them among the premium hospitals in NCR, with 90%+ of the revenue mix at those two units coming from cash and private-insurance patients.

The clearest single number supporting the thesis: adjusted EBITDA margin excluding the two loss-making newer units (New Delhi and Faridabad Sector 20) was 28.1% in Q1 FY27. The core business is a 28%-margin business being reported at 23.3% because it is carrying its own expansion.

7.3 The two things holding margins down

1. Government payer mix rose to ~40% against a stated target of 25%, driven by a CGHS rate revision. Government business carries structurally lower realisations — management has explicitly said the mix should decline toward 25%, and margin expansion is tied to that.
2. New Delhi's occupancy is only 29% on an expanded census bed base, and breakeven is not expected until Q3-Q4 FY27. This single hospital is a meaningful drag on reported margin.

7.4 The growth pipeline

Watch the cost line, not just the bed count. Management disclosed that capex per bed has risen to ₹61.4 lakh, from ₹30.7 lakh three years ago, and guided ₹75-80 lakh per bed for future expansions. The cost of each incremental bed has roughly doubled. That materially changes the return on the 5,000-bed plan — and it is exactly why the company needs ₹3,150 crore rather than ₹1,500 crore to get there.

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8. Management Commentary

From the Q1 FY27 earnings call (11 August 2026), Mr. Yatharth Tyagi, Whole-Time Director:

"I'm pleased to report a strong start of FY27. We delivered our highest ever quarterly revenue and profits this quarter. More encouragingly, we achieved a record revenue growth of 51% year-on-year and an EBITDA growth of 39% year-on-year."

"Our newer hospitals at Greater Faridabad, New Delhi Faridabad Sector 20 and Agra collectively contributed 27% to the mix this quarter... A key highlight was our Faridabad Sector 20 hospital turning EBITDA breakeven within a record period of 9 months."

"The opportunity now is to fill these beds; improve utilization and allow earnings to catch up with the capacity we have created."

That last sentence is the most honest and important thing management has said. Earnings catching up to capacity is the entire investment case — and it is also an admission that the capacity has run ahead of the profits.

On the DME-style capital discipline question, the CFO, Mr. Pankaj Prabhakar, and Group Financial Controller Mr. Sonu Goyal gave specific guidance:

• Depreciation: ₹20-30 Cr per quarter
• Interest: ₹6.6 Cr in Q1, with no fresh loans planned
• CapEx per bed: ₹61.4 lakh achieved; ₹75-80 lakh guided for future expansions

Formal guidance issued for FY27:

• Revenue growth to exceed the prior year's 37%
• Consolidated EBITDA margin above 24%
• Capacity to reach 3,200+ beds, with the 5,000-bed target pulled forward to ~2.5 years

On the interim dividend of 5% of face value and the first ESOP grant under a new ESOP Scheme 2026, the company framed both as signals of confidence. It also opened a Yatharth Information Center in Uzbekistan and ran OPD initiatives across Asia, Africa and the Middle East to build international patient flow.

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9. Technical Analysis

Indicators are computed on the daily series through the 7 October 2026 close of ₹1,032.70 (the last settled close available to both sources at computation time); the 8 October close of ₹1,014.20 is used as CMP for level distances. Two independent sources were cross-checked — a local script on 247 valid bars and the Yahoo Finance series on 496 valid bars. No disagreement exceeds 3% except RSI, where the difference is methodological (simple average vs Wilder smoothing).

9.1 Indicator panel

9.2 The moving-average stack is textbook bullish

SMA 20 (₹1,057) > SMA 50 (₹959) > SMA 100 (₹896) > SMA 200 (₹793) — a fully positively-aligned stack, with the 200-DMA rising (₹793 now vs ₹760 twenty sessions ago). Price sits 27.9% above the 200-DMA and 84% above the 52-week low.

Historical closes: 5 sessions ago ₹1,108.00; one month ago ₹962.30; three months ago ₹827.00; six months ago ₹671.55 — a clean multi-month advance of ~54% over six months.

9.3 Price levels

Structure: the stock is 12.7% below its 23 September high and trading below its 20-DMA and short-term EMAs, but comfortably above its 50, 100 and 200-DMAs in a positively-aligned stack. This is a normal pullback within a strong longer-term uptrend, not a trend break. The honest short-term read is neutral-to-soft: RSI ~50, MACD in a bearish crossover with a widening negative histogram, and volume down 69% versus the 20-day average. Reclaiming ₹1,057 would reaffirm the upside; a sustained loss of ₹958 would be the first genuine warning.

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10. Delivery Data, Block Deals & Insider Activity

10.1 NSE delivery data — last 10 trading sessions

Source: NSE bhavcopy (sec_bhavdata_full CSVs), DATE1-verified, series EQ confirmed. Market holidays in the window: 2 October 2026 (Gandhi Jayanti) — the request returned the prior session's file and was excluded by date verification.

Statistics: average delivery 39.82%; average volume 4,11,309 shares; 6 accumulation days (delivery >40%); zero distribution days (delivery <30%).

This is a materially better tape than a 12.7% decline would suggest. Price fell from ₹1,162 to ₹1,014 over these ten sessions, yet average delivery held near 40% and not a single session printed distribution-grade delivery. The standout is 30 September: a -6.8% capitulation candle on 8,75,912 shares (2.1x the average) that still delivered 41.09% — genuine delivery-based buyers absorbing the selling rather than intraday churn.

One caveat, stated plainly: delivery has softened at the tail (42.18% → 41.09% → 37.86% → 35.38%) while volume dried up from 4.35 lakh to 2.10 lakh shares. The strongest accumulation evidence sits mid-window; the last three sessions look like a drift losing participation. Net read: mild accumulation overall, losing momentum into 8 October — neither aggressive accumulation nor heavy distribution.

10.2 Bulk and Block Deals — Calendar 2026

Calendar 2026 contains exactly one bulk deal — a 5 lakh share transfer in July at ~₹815 — and no block deals at all. The last block deal was in January 2024.

The more informative history is from November 2025, when the promoter sale occurred (Section 6.1):

The reading: the promoter's 5.8% was substantially absorbed by real institutional money — Kotak MF and Carnelian took meaningful positions at ~₹720. That is a more constructive interpretation than "promoter dumped and retail caught it," and it is worth noting that both buyers are down on those positions at the current ₹1,014... actually up: they bought at ₹720 and the stock is now ₹1,014, so Kotak and Carnelian are sitting on roughly 40% gains. Institutional money that bought the promoter's block has been well rewarded.

10.3 Insider activity

No material insider buying or selling by directors or KMP is disclosed for 2026. Promoter filings are limited to routine annual Regulation 31(4) disclosures. No promoter pledge exists.

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11. Forward PE Valuation

11.1 The dilution is the story — and it is not in the consensus numbers

The ₹3,150 crore Advent preferential issue changes the share count materially:

Profit must rise 33% simply to keep EPS flat on a fully diluted basis (₹174 Cr × 12.833/9.635 = ₹232 Cr required, versus TTM PAT of ₹174 Cr).

11.2 Where the estimates stand

This is the single most important calculation in this report. The published consensus FY27 EPS of ₹26.58 appears to be computed on a pre-issue share count. Restated for the equity that is actually being issued, the same profit stream produces ₹23.41, and restated fully diluted it produces ₹19.95 — roughly 25% below the headline consensus number.

11.3 Forward multiples at ₹1,014.20

Multiples in context: trailing P/E 53.9x against an industry P/E of 47.8x, EV/EBITDA 30.2x, P/B 5.5x on a 10.2% ROE. For a business whose net profit has not grown in five quarters.

11.4 Credibility check — does the consensus require margins above guidance?

Management's FY27 guidance is revenue growth >37% and EBITDA margin >24%.

Working back from the consensus FY27 revenue of ₹1,708 Cr and implied PAT of ₹256 Cr:

• PBT ≈ ₹341 Cr (at a 25% tax rate)
• EBITDA = PBT + depreciation (₹115 Cr) + interest (₹26 Cr) − other income (₹30 Cr) ≈ ₹452 Cr
• Implied EBITDA margin = 26.5% against guidance of "above 24%"

So the consensus needs margins ~2.5 percentage points above the guided floor — achievable if the payer mix improves and New Delhi turns, but it is not a conservative number, and it is being combined with a share count that ignores the dilution entirely. My own build (revenue ₹1,700-1,750 Cr, EBITDA margin 24.5-25%, depreciation ₹115 Cr, interest ₹26 Cr) gives PAT of ₹229-245 Cr and EPS of ₹21-22 post-equity.

11.5 PEG

Trailing PEG is 1.42 (Screener). On a forward basis: FY27E EPS of ₹23.41 (post-equity) versus FY26's ₹18.20 is +28.6% growth, against a 43.3x forward P/E — a forward PEG of ~1.5. On FY28, the restated fully diluted EPS of ₹25.87 implies ~30% growth against a 39.2x multiple, a PEG of ~1.3.

A PEG above 1.3-1.5 is not a value entry — it is the price of a high-quality structural growth story, and it is only justified if the 5,000-bed plan translates into earnings. Note also that the EPS "growth" from ₹18.20 to ₹23-26 is heavily influenced by the low FY26 base, where depreciation and interest were still ramping — the same base-effect caution the checklist requires.

11.6 What has to be true

At ₹1,014.20 the market is paying 53.9x trailing and 43-51x forward for a business with a 10.2% ROE, three consecutive years of negative free cash flow, and flat net profit. That price requires:

1. The Advent issue to complete — EGM approval on 15 October and CCI clearance
2. Revenue growth above 37% to sustain, driven by the newer hospitals maturing
3. EBITDA margin above the guided 24% floor — ideally toward 26-27% to justify consensus
4. The payer mix to improve from ~40% government back toward the 25% target
5. New Delhi to reach breakeven in Q3-Q4 FY27 as promised
6. Gurugram to open on time in Q1 FY28 at ₹50,000+ ARPOB
7. Capex per bed to stop escalating beyond ₹75-80 lakh
8. Net profit to finally move — because depreciation and interest will keep consuming operating growth until the new beds fill

The Advent entry price of ₹985.17 is the single most useful valuation anchor available, because it is what a globally sophisticated healthcare investor agreed to pay for 24.87% after diligence. It sits 2.9% below the current market price.

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12. Recent News & Catalysts

Positive

• Advent International to invest ₹3,150 crore ($328.5 million) via its Cyprus fund Rasmalai Limited for 24.87% of the company on a fully diluted basis — one of the largest primary PE investments ever in Indian hospital delivery, at ₹985.17 per share (17 September 2026)
• Q1 FY27 record quarter: revenue ₹392.65 Cr (+52.3% YoY), EBITDA ₹91.7 Cr, adjusted EBITDA margin excluding the two loss-making new units 28.1%
• Faridabad Sector 20 hit EBITDA breakeven in nine months; Agra delivered 20%+ EBITDA in its first full quarter
• New Delhi and Noida Extension both crossed ₹50,000 ARPOB, with 90%+ cash and private-insurance payer mix
• Group ARPOB at an all-time high of ₹34,758 (+7% YoY)
• Gurugram acquisition completed (12 June 2026) — 250 beds for ₹100 Cr, live Q1 FY28
• Oncology at ~10% of revenue with one LINAC, two more planned
• Income tax matters trending favourably — properties and fixed deposits that had been provisionally attached were released in November 2025, with a further "Favourable Developments" disclosure on 14 September 2026
• Maiden interim dividend of ₹0.50/share and first ESOP grant under ESOP Scheme 2026
• Institutional absorption of the promoter block — Kotak Mahindra MF and Carnelian bought at ~₹720 in November 2025

Neutral / in progress

• EGM on 15 October 2026 for shareholder approval of the preferential issue, the special rights to Advent, and the promoter incentive arrangement
• CCI approval pending — Advent filed its notice in early October 2026
• Government payer mix at ~40% against a 25% target — the key margin lever, moving the wrong way
• New Delhi occupancy at 29% with breakeven guided for Q3-Q4 FY27
• Brownfield Noida Extension and Greater Noida expansions delayed by monsoon, 15-18 months out
• No fresh loans planned; depreciation guided at ₹20-30 Cr per quarter

Negative / risks

• Net profit flat for five consecutive quarters despite 52% revenue growth
• Promoter Neena Tyagi sold 5.8% (₹404 Cr) in a single day on 28 November 2025; the stock fell 8.3%
• Dilution of 24.87% on a fully diluted basis, cutting promoter holding to ~42%
• Free cash flow negative for three years (-₹112 Cr in FY26)
• Capex per bed has doubled to ₹61.4 lakh and is guided at ₹75-80 lakh going forward
• Consensus price target (₹1,008.50) sits below the current price (₹1,014.20)
• Q1 FY27 revenue missed analyst estimates, and the stock fell 2.04% on the result
• Hostile market environment — the Nifty closed at a 52-week low on 8 October 2026 after an RBI rate hike
• Debtor days of 113 — high insurer and government receivables

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13. Key Risks

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14. Screener Pros & Cons

Pros

• Company is expected to give a good quarter
• Company has delivered good profit growth of 56.9% CAGR over the last 5 years
• Company's working capital requirements have reduced from 101 days to 80.1 days

Cons

• Company has a low return on equity of 12.0% over the last 3 years
• Promoter holding has decreased over the last 3 years: -10.5%

Our additions: Screener's pros and cons do not capture the flat net profit over five quarters, the negative free cash flow, the 113 debtor days, the doubling of capex per bed, or the 24.87% dilution now pending. All five are material to the investment case.

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15. Bull vs Bear

The Bull Case

1. Revenue is compounding at 34% a year and accelerated to 52% in Q1 FY27. The newer hospitals contributed 27% of group revenue and are scaling fast.
2. The turnaround playbook is proven. Faridabad Sector 20 broke even in nine months; Agra hit 20%+ EBITDA in its first full quarter. This is a repeatable model, not a hope.
3. The core business earns 28.1% EBITDA margins — the reported 23.3% is depressed by two specific loss-making units that are on a known path to breakeven.
4. Advent International validated the business at ₹985.17 per share with a $328.5 million cheque — the largest PE investment in Indian hospitals, after diligence, with no promoter exit and board representation.
5. ₹3,150 crore solves the funding problem. The 5,000-bed target can now be pursued without stretching the balance sheet, relieving the interest burden and letting operating cash flow compound.
6. Structural sector tailwinds: India's bed density remains far below global norms, insurance penetration is rising, and healthcare is a domestic-demand business insulated from trade shocks.
7. ARPOB is rising (+7% YoY to an all-time high) as the mix shifts toward premium NCR specialities — oncology, cardiac sciences, neurosciences — with oncology at 10% of revenue from a single machine.
8. Operating cash conversion is strong at 94% of operating profit, and working capital days improved from 101 to 80.1.

The Bear Case

1. Net profit has not grown in five quarters. Revenue rose 52% and PAT stayed at ₹45 Cr. Depreciation (₹15→₹28 Cr) and interest (₹0→₹7 Cr) absorbed everything.
2. The dilution is 24.87% fully diluted, and consensus EPS does not reflect it. Restated, FY27E EPS falls from ₹26.58 to ₹19.95 on a fully diluted basis — a 25% haircut to the headline number.
3. The stock trades above the average analyst target. Investing.com's four-analyst consensus is ₹1,008.50 versus a ₹1,014.20 close.
4. A promoter sold 5.8% for ₹404 crore in a single day in November 2025, driving an 8.3% fall. Promoter holding is down 10.7pp in two years.
5. Returns are poor for the valuation. ROE 10.2%, ROCE 12.9%, P/B 5.5x. The equity being issued at ₹985 is going into a business currently earning 10% on it.
6. Capex per bed has doubled to ₹61.4 lakh and is guided at ₹75-80 lakh — so the 5,000-bed plan costs far more per bed of earning capacity than the existing base did.
7. Free cash flow has been negative for three years and the company has funded itself with debt and equity.
8. Payer mix is moving the wrong way — government at ~40% against a 25% target, and management ties margin expansion to fixing it.
9. Near-term catalysts are binary and pending — EGM approval on 15 October, CCI clearance, and New Delhi's breakeven slipping to Q3-Q4 FY27.
10. The market environment is hostile — the Nifty closed at a 52-week low on 8 October with RBI tightening and FII selling. High-multiple growth names get de-rated first in that regime.

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16. Final Verdict

Rating: CAUTION — quality growth story, rich valuation. Wait for the Advent price, not the market price.

Where we land: Yatharth is one of the more impressive execution stories in Indian healthcare. Revenue has compounded at 34% a year, the acquisition-and-turnaround playbook demonstrably works — nine-month breakeven at Faridabad Sector 20 is genuinely fast — and Advent International has just put $328.5 million behind that record at ₹985.17 a share. The operating facts support the thesis.

Three things argue against paying today's price:

1. The profits are not following the revenue, and will not for some quarters. Net profit has been flat at ₹42-45 Cr for five consecutive quarters. Depreciation of ₹28 Cr a quarter and interest of ₹7 Cr a quarter are structural, not one-off, and they will keep consuming operating growth until the new beds fill. The stock is capitalised at 54x that flat earnings line.
2. The dilution is 24.87% on a fully diluted basis and the published consensus ignores it. Restate the same profit stream for the shares actually being issued and FY27E EPS drops from ₹26.58 to ₹19.95. That is the difference between a 38x stock and a 51x stock, and it is not in the headline numbers most investors will look at.
3. The market price is above the consensus target and above Advent's own entry price. Advent — with diligence access, sector expertise and board representation — agreed to pay ₹985.17. The market is asking ₹1,014.20.

The cleanest way to frame it: Advent is buying 24.87% of this business at ₹985. If ₹985 is good enough for Advent, it is a sensible reference for a retail investor — and there is no reason to pay a 3% premium to a marquee PE investor with better information and better terms.

What would upgrade the view:

• Q2 FY27 (11 November) showing net profit growth, not just revenue growth — the flat-PAT pattern breaking
• EBITDA margin trending toward 26-27%, above the guided 24% floor
• Government payer mix declining from ~40% toward 25%
• New Delhi reaching breakeven on schedule in Q3-Q4 FY27
• Completion of the EGM and CCI approvals without adverse terms on the promoter profit-share arrangement
• Gurugram opening on time in Q1 FY28 at ₹50,000+ ARPOB

What would confirm the bear case:

• Another flat-profit quarter in November despite strong revenue
• Further promoter selling, or the profit-share arrangement passing on terms unfavourable to public shareholders
• New Delhi breakeven slipping beyond FY27
• Any escalation of the income tax matter
• A close below the 50-DMA at ₹958, with the 200-DMA at ₹793 as the deeper reference

Suitability by investor profile

Ideal accumulation zone: ₹900-985 — anchored on Advent's ₹985.17 entry price on the upper end and the 50-DMA at ₹958, with ₹900 providing a buffer. This is a business to own at the price a sophisticated investor just paid for it, not above.

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17. Swing Trade Assessment (25-Point Checklist)

17.1 All 25 points assessed

17.2 Score: 20.0 / 25

This lands in the 17-21 "Moderate — needs a catalyst for entry" band, and there are no critical fails on the key items (1, 2, 6, 20, 24 — items 6 and 24 are cautions, not fails).

The score is genuinely instructive because the two fails sit in opposite places. Item 18 (delivery) is a strong pass — 40% average delivery with zero distribution days is real accumulation, and that is the most encouraging technical fact in this report. Item 21 (market environment) is an outright fail — buying anything long into a Nifty that just closed at a 52-week low is fighting the tape. And item 17 fails on the fundamentals: revenue +52% with profit +12% is not the earnings acceleration a momentum entry needs.

17.3 Trade setup if you take it

Honest summary for a swing trader: the tape is better than the price action looks. Delivery of ~40% with zero distribution sessions through a 12.7% drawdown tells you real buyers are absorbing supply, and the moving-average stack is fully bullish with a rising 200-DMA. But the stock is in a correction, the market itself is at a 52-week low, and the fundamental trigger — profit growth rather than revenue growth — has not arrived. The trade is to wait for ₹1,057 to be reclaimed, or to buy the ₹958-985 zone where Advent's own entry price provides a fundamental floor. Chasing at ₹1,014 offers neither confirmation nor a discount.

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18. Exchange Filings & Material Announcements

Recent NSE filings that can affect the price or the finances:

• 17 September 2026 — Board approves a ₹3,150 crore preferential issue to Advent International (via Rasmalai Limited, Cyprus) for 24.87% of the post-issue fully diluted capital: 1,30,26,516 equity shares (₹1,283.33 Cr) and 1,89,47,664 warrants (₹1,866.67 Cr) at ₹985.17 each. Includes amended Articles granting special rights to the investor, an "Upside Share Arrangement" giving promoter Ajay Tyagi a graded share of Advent's exit profits, and an increase in authorised capital from ₹115 Cr to ₹150 Cr. Subject to shareholder approval at the EGM of 15 October 2026. NSE filing

• 14 September 2026 — "Favourable Developments in Income Tax Proceedings." Follows the November 2025 orders from the Deputy Commissioner of Income Tax, Delhi releasing all provisionally attached properties and unfreezing previously attached fixed deposits. NSE filing

• 11 August 2026 — Q1 FY27 earnings call and investor presentation. Record revenue of ₹392.65 Cr (+52.3% YoY), EBITDA of ₹91.7 Cr at 23.3% (adjusted 28.1% excluding the two new loss-making units), PAT of ₹47.06 Cr (+11.9%), ARPOB at an all-time high of ₹34,758, and guidance of >37% revenue growth with EBITDA margin above 24% for FY27. NSE filing

• 10 August 2026 — Maiden interim dividend of ₹0.50 per share (5% of face value) declared alongside the Q1 FY27 results; ex-date 14 August 2026. NSE filing

• 12 June 2026 — Completion of the Gurugram hospital asset acquisition. The 250-bed under-construction hospital in Sector 40, Gurugram was acquired from RNY Healthcare Services Private Limited for ₹100 crore in cash, registered and transferred to AKS Medical & Research Centre Private Limited, a wholly-owned subsidiary. Targeted to go live in Q1 FY28 with potential ARPOB above ₹50,000. NSE filing

• 28 November 2025 — promoter stake sale. Promoter Neena Tyagi sold 56,33,800 shares (5.8% of paid-up equity) for ₹403.93 crore at ₹716.98 per share via a bulk deal on NSE; Kotak Mahindra Mutual Fund and Carnelian Asset Management were among the buyers. The stock fell 8.3% that session.

Corporate actions note: the company paid its maiden interim dividend of ₹0.50 per share with an ex-date of 14 August 2026. There has been no stock split or bonus since listing in July 2024, so historical price levels are directly comparable. The AGM was held on 25 September 2026 and the next material corporate event is the EGM on 15 October 2026.

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19. Disclaimer & Sources

This analysis is for information and education only. It is not investment advice and not a recommendation to buy, sell or hold. It was prepared by an AI agent (deepseek-v4-flash via Hermes Agent) from public sources. It contains forward-looking estimates that are frequently wrong — the dilution-adjusted EPS figures in Section 11 are my own calculations from disclosed share counts and may differ from the company's or the market's conventions. Verify all figures against company filings before acting.

Sources

• Screener.in — Yatharth Hospital consolidated page (logged-in, session verified at 27 sidebar items, 8 October 2026): sidebar metrics, quarterly results (Jun 2023-Jun 2026), annual P&L (FY22-FY26 + TTM), balance sheet, cash flow, shareholding pattern, pros and cons
• NSE corporate filings (nsearchives.nseindia.com) — board outcome of 17 September 2026 (preferential issue, restated Articles, promoter incentive, EGM convening); press release; Q1 FY27 earnings call transcript of 18 August 2026; investor presentation of 11 August 2026; board outcome and interim dividend of 10 August 2026; Gurugram acquisition update of 12 June 2026 and its original press release of 13 May 2026; income tax disclosure of 14 September 2026; corporate actions and announcement history (306 filings)
• NSE bhavcopy — delivery and volume data for ten sessions, DATE1-verified
• Yahoo Finance — price history (496 bars), 52-week range, analyst price target of ₹1,163.75, returns (YTD +48.76%, 1Y +21.99%, 3Y +152.60%, 5Y +231.33%)
• Investing.com — four-analyst consensus price target of ₹1,008.50, EV/EBITDA 30.2x, P/B 5.73, RSI(14) 56.43, and Q1 revenue-miss note
• Markets Insider — consensus FY27 and FY28 EPS and revenue estimates
• Trendlyne — bulk and block deal history (all 42 records), including the 14 July 2026 trade and the November 2025 promoter sale
• Moneycontrol / CNBC-TV18 / NDTV Profit — promoter Neena Tyagi's ₹404 crore sale of 56.33 lakh shares at ₹716.98 on 28 November 2025; the income tax attachment release of 13 November 2025
• Sahi / ScanX / Digital Health News / NDTV Profit — Advent International's ₹3,150 crore investment, the Cyprus-based Rasmalai Limited vehicle, the CCI approval filing of early October 2026, and confirmation of no promoter exit
• ValuePickr forum — retail and analyst discussion of the promoter stake sale mechanics
• Tavily — news aggregation and cross-referencing across the above

Data limitations

• The primary valuation input — the share count — is a moving target until the EGM and the warrant exercise. This report models 9.635 Cr shares currently, 10.938 Cr post-equity-issue and 12.833 Cr fully diluted.
• Depreciation and interest guidance is company-stated (₹20-30 Cr and ₹6.6 Cr per quarter) and has been trending upward; a material step-up would further compress EPS.
• The consensus EPS figures may already assume a different share count than I have modelled. I could not verify the share count underlying the Markets Insider FY27 EPS of ₹26.58, which is why I present the restated figures explicitly rather than asserting a single number.
• ARPOB, occupancy and hospital-level data are company-reported and not independently audited; the Q1 FY27 call cited 2,555 beds while later press reports cite ~2,800.
• The promoter profit-share arrangement has not been finalised. Its terms — including the minimum return threshold and the graded share — are not fully public, so its economic impact on public shareholders cannot yet be quantified.