Healthcare sector is a formidable industry in India with a huge share in domestic as well as international markets. The healthcare sector in India includes diagnostics, pharmaceuticals, medical and hospital supplies manufacturers, and medical insurance companies.
Investing in stocks of healthcare companies can be a great addition to your investment portfolio. These stocks have shown remarkable performances during the past few years as the world battled the pandemic and the need for a robust healthcare infrastructure assumed a greater significance in the government policy making and public life.
To understand the healthcare stocks better, you need to first understand the healthcare industry better. So, let’s begin.
About the Healthcare Sector
The healthcare sector is vast. It includes:
1. Diagnostic
The diagnostic sector is a major part of the healthcare industry. The diagnostic sector plays the role of an information intermediary. The role of the diagnostic company is to offer useful information for accurate diagnosis and treatment of diseases. So, whenever you visit a clinic for a blood test or magnetic resonance imaging (MRI) then that clinic is said to be a diagnostic center. Now, the diagnostic industry is widely spread. There are unorganised players (47%), hospital-based labs (37%) and organized players (~16%). As multiple players are offering the same test at different prices. In such a situation, patients often prefer to go to a clinic which gets the test done at a comparatively cheaper price. Hence, the challenge that the diagnostic players face is the pricing pressure. So, players often focus on acquiring more patients so that their profit margin increases contributing to the increase in total revenue.
2. Medical devices, equipment, and hospital supplies manufacturers
These players focus on manufacturing products for the healthcare sector. They make surgical instruments, dental equipments, laser machine and a lot more. They also manufacture hospital beds and other equipment required in the hospital.
3. Medical insurance players
Medical insurance players provide medical insurance or similar services to their patients. This sector includes players like health maintenance organizations (HMOs), companies which offer medicare services, healthcare consultants and healthcare staff recruitment agencies.
4. Pharmaceutical segment
The pharmaceutical segment is an important part of the healthcare industry. This sector consists of players that produce over the counter (OTC) drugs, prescription drugs, biopharmaceutical drugs and generic drugs.
List of Healthcare Stocks Listed in India
Company Name | BSE Code | NSE Symbol | CMP | Market Cap (In Crores) |
500488 | ABBOTINDIA | 27,472.7 | 58,377.6 | |
539523 | ALKEM | 5,198.8 | 62,158.9 | |
508869 | APOLLOHOSP | 6,353.9 | 91,359.3 | |
524804 | AUROPHARMA | 1,326.9 | 77,745.3 | |
532523 | BIOCON | 350.8 | 42,111.0 | |
500087 | CIPLA | 1,512.1 | 122,106.1 | |
543960 | CONCORDBIO | 1,689.9 | 17,679.1 | |
532488 | DIVISLAB | 4,539.3 | 120,504.2 | |
539524 | LALPATHLAB | 2,950.9 | 24,633.8 | |
500124 | DRREDDY | 6,719.5 | 112,100.4 | |
543245 | GLAND | 2,031.7 | 33,472.6 | |
532296 | GLENMARK | 1,381.5 | 38,984.3 | |
532482 | GRANULES | 514.4 | 12,466.2 | |
524494 | IPCALAB | 1,223.6 | 31,042.0 | |
506943 | JBCHEPHARM | 1,749.6 | 27,156.1 | |
539276 | KAYA | 663.8 | 867.1 | |
543328 | KRSNAA | 662.3 | 2,138.4 | |
540222 | LAURUSLABS | 463.4 | 24,983.2 | |
500257 | LUPIN | 1,797.8 | 81,970.0 | |
543904 | MANKIND | 2,152.5 | 86,234.7 | |
543220 | MAXHEALTH | 900.5 | 87,520.7 | |
542650 | METROPOLIS | 2,053.6 | 10,520.1 | |
524816 | NATCOPHARM | 1,184.4 | 21,213.8 | |
500674 | SANOFI | 6,377.6 | 14,688.0 | |
524715 | SUNPHARMA | 1,577.3 | 378,447.1 | |
539268 | SYNGENE | 742.2 | 29,876.3 | |
539871 | THYROCARE | 637.8 | 3,377.3 | |
500420 | TORNTPHARM | 2,948.5 | 99,788.9 | |
543350 | VIJAYA | 784.1 | 8,044.7 | |
543950 | YATHARTH | 429.8 | 3,689.8 | |
532321 | ZYDUSLIFE | 1,175.2 | 118,247.6 | |
532843 | FORTIS | 480.4 | 36,268.2 |
Let’s Take a Look at A Few Stocks from The Healthcare Sector
Apollo hospitals
Apollo Hospitals owns the largest pharmacy chain in India. Not just that the hospital has also emerged as Asia’s foremost integrated healthcare services provider as it has a solid presence in the healthcare sector. This includes hospitals, pharmacies, primary care & diagnostic clinics and several retail health models. The company generates majority of its revenue from its healthcare business (53%). Its pharmacy business, Apollo pharmacy helps the company generate 41% revenues. Its health and lifestyle business generates 6% revenues. The hospital has 4,118 outlets across 20 states and 4 union territories.
Source: Investor presentation of Apollo hospitals Quick overview of Apollo Hospitals
Apollo Hospitals Enterprise Ltd. | ||||
Market Cap (Cr): | 91,359.3 | Face Value | Rs. 5 | EPS: Rs. 62.5 |
482 | 15.55 | Debt to Equity: 0.77 | ||
103 | 13.67 | Dividend Yield (%): 0.25 | ||
Promoter’s Holdings (%): | 29.30% | Total Debt (Cr) | Rs. 5,332 |
*Data as on 12th July 2024
Max healthcare
Max healthcare is the second largest hospital chain in the healthcare segment. It has excelled in offering services of oncology, neurosciences, cardiac sciences, orthopaedics, renal sciences and a lot more. Their chain of hospitals has a total bed capacity of more than 3,400 beds out of which 85% of beds are available in metro cities. The company has also acquired a 37% stake in Eqova healthcare which has a potential of adding 400+ beds in East Delhi. Source: Investor presentation of Max healthcare Quick overview of Max healthcare
Max HealthCare | ||||
Market Cap (Cr): | 87,520.7 | Face Value: | Rs. 10 | EPS: Rs. 10.88 |
Book Value: | 86.5 | Roce (%): | 16.01 | Debt to Equity: 0.15 |
Stock PE: | 84.8 | ROE (%): | 13.37 | Dividend Yield (%): 0.11 |
Promoter’s Holdings (%): | 23.80% | Total Debt (Cr): | Rs. 1,298 |
*Data as on 12th July 2024
Lal Path labs
Dr Lal Path labs is a renowned name and India’s leading consumer healthcare brand in the diagnostic sector. The company has an integrated nationwide network where they offer a broad range of diagnostic and healthcare-related tests and services. The company has 216 laboratories, 3,095 patient service centres and around 7,000 pick-up units available across India. However, the company has dominated presence in the Northern parts of the country. If we look at the geographical breakup then, Delhi NCR is the dominant market for the company which has a market share of around 37%. Quick overview of Dr. Lal Pathlabs
Dr. LalPath Labs | ||||
Market Cap (Cr): | 24,633.8 | Face Value: | Rs. 10 | EPS: Rs. 42.85 |
Book Value: | 222 | Roce (%): | 25.17 | Debt to Equity: 0.13 |
Stock PE: | 70 | ROE (%): | 20.36 | Dividend Yield (%):0.81 |
Promoter’s Holdings (%): | 54.6 | Total Debt (Cr): | Rs. 246.93 |
*Data as on 12th July 2024
Fortis Healthcare
Fortis Healthcare is a leading integrated healthcare service provider across PAN India. The healthcare verticals of the company consist of hospitals, diagnostics and day care speciality facilities. The company had recently acquired Super Religare Laboratories (SRL). It operates its diagnostics business through its 57% owned subsidiary in SRL Limited. Quick overview of Fortis Healthcare
Fortis Healthcare | ||||
Market Cap (Cr): | 118,247.6 | Face Value: | Rs. 10 | EPS: Rs. 7.93 |
Book Value: | 102 | Roce (%): | 10.34 | Debt to Equity: 0.15 |
Stock PE: | 62.7 | ROE (%): | 7.85 | Dividend Yield (%):0.21 |
Promoter’s Holdings (%): | 31.2 | Total Debt (Cr): | Rs. 1,155 |
*Data as on 12th July 2024
Metropolis Healthcare
Metropolis Healthcare Ltd. is another leading healthcare company dominating in the western parts of India. Quick overview of Metropolis Healthcare
Metropolis HC | ||||
Market Cap (Cr): | 10,520.1 | Face Value: | Rs. 2 | EPS: Rs. 24.95 |
Book Value: | 214 | Roce (%): | 15.45 | Debt to Equity: 0.18 |
Stock PE: | 83 | ROE (%): | 12.26 | Dividend Yield (%):0.39 |
Promoter’s Holdings (%): | 49.70% | Total Debt (Cr): | 197.07 |
*Data as on 12th July 2024
Vijaya Diagnostic
Vijaya Diagnostics Centre is a leading and the largest diagnostic services provider in Southern parts of India. It offers services like nuclear medicine, radiology, laboratory, health check-ups and medical services. More than 92% of revenue is generated from its business to customer (B2C) segment. The unique part of the company is that it follows a hub and spoke model. So, in a hub and spoke model the company will have test centers at multiple places but the laboratory will be at a different location. So, the test centers will collect the samples and send them to the laboratory at once. This will help the company increase its geographical presence while reducing its capital expenditure (Capex). Quick overview of Vijaya Diagnostic
Vijay Diagonistics | ||||
Market Cap (Cr): | 8,044.7 | Face Value: | Rs. 1 | EPS: Rs. 11.6 |
Book Value: | 64.2 | Roce (%): | 21.56 | Debt to Equity: 0.39 |
Stock PE: | 66.8 | ROE (%): | 20.03 | Dividend Yield (%):0.12 |
Promoter’s Holdings (%): | 54.1 | Total Debt (Cr): | 259.18 |
*Data as on 12th July 2024
Bottom line
No matter what we are never going to compromise with our health and hence the healthcare industry is forever going to be in the spotlight. To know which are the best healthcare stocks to buy, all you need to do is visit Samco’s star ratings page and check the ratings for healthcare stocks. The rating of a stock is revised daily and is calculated using more than twenty million data points. It also mentions the ratios and pros and cons of investing in the company. So, researching stocks just got easier. To invest in any of the healthcare stock, open a Free Demat account with Samco.
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