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Raffles Medical Group - OCBC Investment 2021-01-26: Modest Recovery

RAFFLES MEDICAL GROUP LTD (SGX:BSL) | SGinvestors.io RAFFLES MEDICAL GROUP LTD (SGX:BSL)

Raffles Medical Group - Modest Recovery

  • Domestic patient footfall in key markets of Singapore and China is on the mend, although medical tourism and patient visits to its GP clinics have yet to recover to pre-pandemic levels.
  • HOLD rating is maintained, with more meaningful recovery prospects likely in FY21E as vaccine rollout in the region progresses and travel restrictions are eased over time.
  • Overall, we see the latest update from Raffles Medical Group (SGX:BSL) as broadly aligned with our expectation for a gradual recovery path, with continued efforts by management to create other revenue sources to lessen the impact from the pandemic.



Domestic patient footfall in key markets of Singapore and China is on the mend

  • Domestic patient footfall in key markets of Singapore and China looks to be on the mend although patient visits to its GP clinics have yet to recover to pre-pandemic levels.
  • In Raffles Medical's Chongqing operations, patient visits to Raffles Chongqing have improved with higher patient visits than last year. Capacity wise, the hospital can expand from the current operations of ~200 beds up to 700 beds and expects to reach EBITDA breakeven by 2022.
  • Raffles Beijing has been expanded and currently has a 21-bedded surgery centre and round the clock emergency service unit, with focus on minimally invasive surgeries due to space constraints.
  • Raffles Shanghai works has progressed with construction completed and pending certification and authority approval (targeted to obtain the necessary approvals next month, with likely opening of ~150 beds and potential to increase capacity to ~400 beds).
  • Medical tourism remains impacted by current travel restrictions in place, with limited travellers allowed to enter Singapore for health purposes which is dependent on vaccine rollout regionally and should take time to see improvements.

HOLD rating maintained






OCBC Research Team OCBC Investment Research | https://www.iocbc.com/ 2021-01-26
SGX Stock Analyst Report HOLD MAINTAIN HOLD 0.960 SAME 0.960



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