Healthcare stock in green after company to acquire SRJ CBCC Cancer Hospital

by Aditya Kumar

Shares of Healthcare Global Enterprises Ltd (HCG), a small-cap healthcare stock, opened at a 3.8 percent increase after the company announced its strategic acquisition of SRJ CBCC hospital in Indore. This acquisition has prompted a bullish movement in the stock market.

On October 5th, the shares of HCG opened at Rs. 376 per share, which is 3.8 percent higher than the previous closing price of Rs. 362.20 per share. However, by the end of the trading day, the share price closed marginally lower at Rs. 362 per share.

The acquisition of SRJ CBCC Cancer Hospital is significant for HCG as it marks the company’s entry into Madhya Pradesh. HCG plans to expand its operations by adding a 100-bed state-of-the-art cancer diagnostic and treatment facility within the next two years. With this acquisition, HCG now operates in 10 states and has become a network of 21 comprehensive cancer centers, 24 hospitals across India and Africa, and 8 daycare centers.

The financial performance of HCG has also shown positive growth. The company’s revenue increased by 12.9 percent to Rs. 460.68 crores in Q1FY24 from Rs. 408.05 crores in Q1FY23. Similarly, the net profit saw a growth of 25.79 percent from Rs. 6.05 crores to Rs. 7.61 crores during the same period.

Looking at the financial ratios, HCG reported a return on equity (ROE) of 2.06 percent and a return on capital employed (ROCE) of 11.69 percent in the last financial year. These figures indicate the company’s effective utilization of capital and assets to generate profits.

Headquartered in Bangalore, HCG is India’s largest cancer care provider. It owns and manages a network of 21 cancer centers, 4 multispecialty centers, and 8 daycare centers across the country. In addition to providing cancer care, HCG is also involved in clinical research and development.

The strategic acquisition of SRJ CBCC Cancer Hospital, along with the positive financial performance, has further strengthened HCG’s position in the healthcare sector. Investors are optimistic about the company’s growth prospects and the potential returns it can generate. However, it is essential for investors to conduct thorough research and analysis before making any investment decisions.

Disclaimer: This article is for informational purposes only and should not be considered as financial advice. The writer does not own any shares of Healthcare Global Enterprises Ltd.

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