Rationale Behind adding Max HealthCare :
- In healthcare I have 2 pharma companies Divis Labs and Abbott India ( Laurus Labs , I am going to sell soon), but I didnt have hospitals or diagnostics.
If you can notice, I want to reorient my portfolio towards consumer centric with more companies from B to C rather than B to B. Hence recent additions like IDFC, Trent, Nestle, Titan etc, So in healthcare I wanted to add Hospital company. - Hospital Industry is a capital intensive business , so it acts as a moat and strong entry barrier.
- Hospital business is very secular in nature, with complete disregard towards macroeconomic situations. Whether economy is in recession or in boom, if someone needs dialysis, once in a week, he has to do it, no matter what. Bed capacity , GDP expenditure on health is very low , so long runway for growth. there are 10 more reasons for visible growth in this sector…But I know you get it.
- Why only Max health? why not Apollo or Narayana or Rainbow?
Max Health has highest revenue per occupied bed and also the occupancy rate is high compared to peers. In hospital business growth comes from acquiring other famous and matured hospitals or taking on lease Trust hospitals and I feel Max Person is good at this game . He has proved it many times, Their expansion strategy is aggressive compared to others. Being secular nature of business, this will also give stability to my portfolio. Again there are many reasons…But this much is enough. I am not a “Baal ki khaal” person. If something appears approximately correct, not precisely correct, I go ahead with it. After all business lies not only in screener… There are many qualitative non-screener attributes to each business… Open to critical opinions as always.
| Subscribe To Our Free Newsletter |
