HealthCare Global Enterprises Ltd. (HCG) is the largest provider of specialized cancer care in India, positioning itself as a premier destination for oncology treatment. Headquartered in Bengaluru, the company has established a vast pan-India network of 25 hospitals across 19 cities, complemented by an international presence in Kenya. HCG's model is built on a patient-centric approach that integrates advanced technology, a deep pool of medical talent, and a comprehensive treatment methodology. The company provides a full spectrum of cancer care, from diagnostics like Digital PET and genomics to advanced treatment modalities including medical, radiation, and surgical oncology, and extends to post-treatment care such as rehabilitation and psychological support. HCG has a track record of being a pioneer in introducing cutting-edge technology to India, such as Cyberknife and Tomotherapy, and continues this legacy with the planned introduction of MR-LINAC technology. This focus on specialized, technology-driven care has enabled HCG to establish leading market positions in 16 of the 19 Indian cities it operates in, solidifying its reputation as a leader in the oncology space.

Official Website: http://www.hcgoncology.com/

• Q3 FY26 Performance:

• Revenue: The company reported total revenue from operations of INR 6,331 million, a year-over-year (YoY) growth of 13% from INR 5,586 million in Q3 FY25. This growth was driven by an 8% increase in patient volumes and a 5% increase in Average Revenue Per Patient (ARPP).

• EBITDA: Adjusted EBITDA grew by 20% YoY to INR 1,108 million, compared to INR 923 million in the prior year's quarter.

• Profitability: Adjusted Profit After Tax (PAT) stood at INR 6 million. The reported PAT was lower primarily due to higher depreciation and interest expenses from recent growth investments and a one-time exceptional item related to a change in gratuity policy.

• Nine Months (9M) FY26 Performance:

• Revenue: For the nine months ended December 31, 2025, revenue increased by 16% YoY to INR 18,931 million.

• EBITDA: Adjusted EBITDA for the period was INR 3,458 million, a 20% increase from the INR 2,893 million recorded in 9M FY25.

• Profitability: Adjusted PAT for 9M FY26 was INR 216 million, compared to INR 371 million in the same period last year.

• Return on Capital: The pre-tax Return on Capital Employed (ROCE) for 9M FY26 stood at 13.3%, remaining stable YoY.

• Debt Position:

• As of December 31, 2025, the company's net debt (excluding capital leases) was INR 7,728 million. Including capital leases under Ind AS 116, the total net debt was INR 16,337 million.

HCG demonstrated strong top-line and operational profit growth driven by a healthy mix of increased patient volumes and higher revenue per patient. However, bottom-line profitability was impacted by increased expenses related to strategic growth investments.

• Specialized Oncology Focus: Unlike multi-specialty hospitals, HCG is dedicated almost exclusively to cancer care. This singular focus allows for deep expertise, specialized infrastructure, and a comprehensive ecosystem tailored to oncology patients.

• Comprehensive Care Platform: HCG provides an end-to-end cancer care solution under one roof. This includes preventive oncology, advanced diagnostics (genomics, molecular imaging), a full range of treatments (medical, surgical, radiation), and post-treatment support (nutrition, psycho-oncology, home health services).

• Pan-India Network: The company operates the largest network of oncology-focused hospitals in India, with a presence in both metro and non-metro cities. This hub-and-spoke model provides wide geographic reach and patient access.

• Technology Leadership: HCG has a consistent history of being the first to introduce advanced medical technologies in India, including Cyberknife, Tomotherapy, and Digital PET. The upcoming North Bangalore facility will feature the city's first MR-LINAC, reinforcing its position as a technology pioneer.

• Clinical Excellence: The company emphasizes a "Tumor Board" approach, where multi-disciplinary experts collaborate on treatment plans, leading to effective and personalized care. This has resulted in industry-leading clinical outcomes, including a low mortality rate of 0.9%.

HCG's unique value proposition lies in its deep specialization in oncology, extensive network, and commitment to deploying advanced technology, which together create a powerful competitive advantage.

• Historical Growth Trajectory: The company has a proven track record of profitable expansion, demonstrating a revenue CAGR of approximately 15% and an Adjusted EBITDA CAGR of approximately 18% between FY20 and FY25.

• Broad-Based Regional Growth (Q3 FY26):

• West Cluster: The largest contributor to revenue (45%), this region grew at 17% YoY, driven by strong patient volumes and the ramp-up of the expanded Ahmedabad hospital.

• East Cluster: This region delivered 13% YoY revenue growth, led by strong performance in Ranchi and Cuttack.

• South Cluster: Despite temporary disruptions from strikes related to a state-sponsored scheme in Andhra Pradesh, the South cluster grew revenue by 9% YoY, led by the Centre of Excellence (COE) in Bangalore.

• International Business: The Kenya operations grew by a robust 42% YoY, indicating a successful ramp-up of radiation oncology and PET services.

• Key Growth Drivers:

• Volume Growth: Overall patient volumes (excluding fertility) increased by 8% YoY in Q3 FY26 and 13% in 9M FY26, reflecting strong patient inflows and market penetration.

• ARPP Growth: Average Revenue Per Patient (ARPP) grew 5% YoY in Q3 FY26, driven by a favorable case mix, particularly high-end work like immunotherapy at the Bangalore COE.

The company's growth is well-diversified across its key regions and is supported by a balanced contribution from both higher patient volumes and improved revenue per patient.

• Optimize Existing Network: HCG plans to enhance its case mix by attracting more complex cases through its best-in-class talent pool. Focused marketing efforts and scaling the international patient business are key initiatives to drive utilization and revenue from the current infrastructure.

• Invest in Targeted Growth: The company is pursuing both brownfield and greenfield expansions. This includes strengthening its presence in existing markets and entering new, attractive markets that align with its expansion framework.

• Improve Network Efficiency: There is a significant opportunity to improve margins through operating leverage as facilities mature. HCG is also focused on prudent cost optimization and developing asset-light adjacencies like day-care centers and diagnostic services.

• Enhance Patient Experience: By continually investing in upgrading infrastructure and maintaining leadership in medical technology, HCG aims to improve the patient journey. Leveraging digital tools and technology is a core part of this strategy to enhance patient engagement and satisfaction.

HCG has outlined clear strategic priorities focused on optimizing its current assets while making targeted investments in new capacity and technology to capture future growth.

• Existing Capacity: HCG's network consists of 25 hospitals with over 2,500 beds, 98 operation theatres, and 38 LINAC (Linear Accelerator) machines for radiation therapy.

• Capital Expenditure:

• For 9M FY26, the company incurred a total capex of INR 2,227 million, a significant portion of which was directed towards the South cluster (INR 1,433 million).

• Ongoing Major Projects:

• North Bangalore Hospital: This is a major greenfield project with a total planned capex of INR 1,290 million, of which INR 692 million has been spent. The hospital is expected to become operational by the end of Q4 FY26.

• Whitefield (Bangalore COE Extension): A brownfield expansion with a planned capex of INR 290 million, of which INR 137 million has been incurred. This extension is expected to be completed in FY27.

The company is actively investing in expanding its capacity, with a clear focus on strengthening its presence in the key Bangalore market through both greenfield and brownfield projects.

• Launch of North Bangalore Facility: The immediate priority is the operational commencement of the new North Bangalore hospital by the end of Q4 FY26. This facility is designed to set new benchmarks in cancer care and will feature Bangalore's first MR-LINAC technology, creating a strong clinical differentiator.

• Strengthening Leadership: HCG has completed the augmentation of its senior leadership team across key functions like marketing, sales, finance, technology, and clinical strategy. This is expected to strengthen execution across all clusters.

• Strategic Pillars for Growth: The company's future strategy is built on four pillars:

1. Optimize Existing Network: Drive better case mix and scale up international business.

2. Invest in Growth: Execute on brownfield and greenfield projects.

3. Improve Network Efficiency: Focus on operating leverage and cost optimization.

4. Enhance Patient Experience: Maintain leadership in medical technology and digital innovation.

HCG's forward-looking strategy is centered on disciplined execution of its expansion projects and leveraging its strengthened leadership team to drive efficiency and growth across its network.

• Q3 FY26 Margin Performance:

• Adjusted EBITDA margin stood at 17.5%, an expansion of 98 basis points (bps) compared to 16.5% in Q3 FY25.

• Reported EBITDA margin was 17.3%, an expansion of 149 bps YoY.

• 9M FY26 Margin Performance:

• Adjusted EBITDA margin was 18.3%, a 60 bps improvement over the 17.7% recorded in 9M FY25.

• Reported EBITDA margin was 18.0%, an 81 bps improvement YoY.

• Driver of Margin Expansion: The improvement in margins is primarily attributed to operating leverage, where revenue growth outpaced the increase in operational expenses.

The company has successfully expanded its operating margins through efficient cost management and the benefits of scale as its revenues grow.

• Dependence on Government Schemes: Government-sponsored health schemes constitute a significant portion of the payor mix (33%). As evidenced by disruptions in Andhra Pradesh and the transition in Odisha's state scheme, any delays, policy changes, or administrative issues in these programs can temporarily impact patient volumes and revenue.

• Execution Risk on New Projects: The successful and timely commissioning of large greenfield projects, such as the North Bangalore hospital, carries inherent execution risks. Delays or cost overruns could impact financial projections and the timeline for realizing returns on investment.

• Case Mix Volatility: As seen in the East cluster, shifts in the case mix or payor mix can negatively affect ARPP. While the company managed to offset this with higher volumes, a sustained adverse shift could pressure regional profitability.

Key operational risks stem from the reliance on government payors and the execution of large capital projects, which require careful management to mitigate potential negative impacts.

• Revenue Mix by Specialty (9M FY26): The revenue is well-diversified across different oncology modalities.

• Medical Oncology: 38%

• Surgical Oncology: 20%

• OP Onco Services (Outpatient): 17%

• Radiation Oncology: 15%

• Non-Oncology: 10%

• Revenue Mix by Payor (9M FY26):

• Cash + TPA (Third-Party Administrators): 55%

• Government Schemes: 33%

• Others (Corporates, Institutions): 9%

• International: 3%

• Leadership Augmentation: The company has successfully filled all key senior leadership roles across corporate and cluster functions, with the new leaders expected to be in place by the beginning of FY27. This strengthens the management bandwidth for future growth.

The company maintains a balanced revenue stream from various oncology specialties and payor types, while strategically strengthening its leadership team to support future expansion.