Raffles Medical Group - Maybank Kim Eng 2021-02-22: Eyes Normalisation In FY21

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

Raffles Medical Group - Eyes Normalisation In FY21


Raffles Medical's 2H20 PATMI ahead expectations; Maintain BUY

  • Raffles Medical (SGX:BSL)’s 2H20 PATMI of S$48.6m (+50% y-o-y) was ahead of our and street’s expectations, due to
    1. activities related to the COVID-19 battle, and
    2. government wage support.
  • Management expects normalisation of most of Raffles Medical’s operations within FY21, including the return of some foreign patients.
  • We raise Raffles Medical's FY21-22E earnings per share forecast by 4-20% to factor in the latest outlook. Correspondingly, our DCF target price increases to S$1.10 (WACC: 9%; LTG: 3%). Maintain BUY.



Aid to COVID-19 battle boosts FY20 revenue

  • Raffles Medical's FY20 revenue rose 8.8% to S$568.2m.
    • Healthcare services rose 17.8%, on the back of COVID-19 related activities such as air borders screening, PCR and serology testing and swabbing of foreign workers.
    • Hospital services rose 2.1% as Raffles Medical took on acute patients under the Emergency Care Collaboration (ECC) with the Ministry of Health, as government hospitals focused their battles against COVID-19.
  • Raffles Medical now has four vaccination centres, with more to open across Singapore.


Developments in China

  • Raffles Medical expects operations to normalise within 2021. Foreign patients are expected to gradually return as vaccination takes place globally.
  • Raffles Hospital Shanghai is slated to start receiving patients in 2H21.
  • Meanwhile, the clinic in Beijing is now fully upgraded to Raffles Hospital Beijing and can support minimally invasive surgeries.
  • According to Raffles Medical, Raffles Hospital Chongqing saw markedly improved volumes y-o-y.

Key risks






Lai Gene Lih CFA Maybank Kim Eng Research | https://www.maybank-ke.com.sg/ 2021-02-22
SGX Stock Analyst Report BUY MAINTAIN BUY 1.10 UP 0.990



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