Shalby Limited (SHALBY) Q2 FY27 Financial Results: PAT ₹10.5 & Revenue ₹338.6 Cr

Investor Takeaways

• Consolidated revenue reached ₹338.6 crores (+11.6% YoY) and PAT was ₹10.5 crores in Q1 FY27.
• Hospital revenue grew 7% YoY to ₹259 crores; MedTech revenue surged 53% YoY to ₹47 crores.
• EBITDA was ₹49 crores; international operations in Gurgaon achieved breakeven.
• Management targets EBITDA margin of up to 20% for FY27; occupancy improvement to 51%; profitability milestones for Shalby International by Q3-Q4 FY27.
• Debt cost reduced by 30 bps without increasing net debt, supporting cash flow and ROCE recovery efforts.

Overall Tone: Neutral

Key Financial Highlights

What Changed

The filing indicates a notable improvement in top-line growth and profitability metrics for Shalby Limited in Q1 FY27. Consolidated revenue increased by 11.6% year-on-year to ₹338.6 crores, driven by strong performance across both hospital and MedTech segments. Hospital revenue grew 7% YoY to ₹259 crores, while MedTech revenue surged 53% YoY to ₹47 crores, reflecting expanding demand and successful product or service diversification. EBITDA stood at ₹49 crores, supporting operating margin expansion. International operations in Gurgaon achieved breakeven, marking a positive development in global scalability. Additionally, debt cost was reduced by 30 basis points without increasing net debt, which enhances cash flow and contributes to ROCE recovery efforts. Management has set clear targets for FY27, including an EBITDA margin of up to 20%, occupancy improvement to 51%, and profitability milestones for Shalby International by Q3-Q4 FY27. These developments suggest a strategic focus on margin expansion, operational efficiency, and sustainable growth in both domestic and international markets.

Peer Comparison

Shalby Limited trades at a higher P/E multiple compared to Sun Pharmaceutical but lower than Divi's Laboratories, indicating moderate valuation relative to peers. However, peer companies show stronger ROE and ROCE metrics, suggesting higher capital efficiency. Shalby’s market capitalization is significantly lower than Sun Pharmaceutical, reflecting its smaller scale within the healthcare services sector.

Risks & Concerns

• No specific risks were identified in the filing.
• The company achieved breakeven in international operations and reduced debt cost without increasing net debt, which mitigates financial risk concerns.

Quarterly Trend

The current quarter’s revenue of ₹338.6 crores and PAT of ₹10.5 crores show a sequential decline in profit compared to Q1FY25 (₹14.74 Cr) and Q4FY24 (₹16.04 Cr), though it marks a return to profitability after a loss in Q3FY25. OPM in the current quarter is not explicitly stated but can be inferred from EBITDA of ₹49 crores on revenue of ₹338.6 crores, resulting in an OPM of approximately 14.5%, which aligns with historical trends. The profitability trend shows improvement from the loss in Q3FY25 but a moderation in PAT growth compared to the previous highs, indicating that while top-line growth is strong, cost management and margin expansion are critical to sustaining earnings momentum.