Equity Analysis /
Thailand

Bumrungrad Hospital PCL: Medical tourism steals the show at 2022 BLS Thai Corporate Day

  • 2022 sector outperformer; 2Q22 up YoY and QoQ

  • No worries about cost-push inflation

  • Normalized relations with Saudi Arabia open opportunities

Bualuang Securities
4 July 2022

We hosted the BLS Thai Corporate Day: Recovery & Beyond on Jul 1, where executives from BH offered a broad overview of the company’s drivers. The outlooks for 2Q22 and 2H22 are bright, led by a strong recovery in fly-in business. Moreover, BH has been laying the groundwork to expand business from Saudi Arabia. The company has the cleanest balance sheet in the sector and the capacity to maintain a dividend. BUY!

2022 sector outperformer; 2Q22 up YoY and QoQ

Among our Healthcare coverage, we see BH as the best play, as foreign patients comprise such a big proportion of its revenue (66% of 2019 receipts) and fly-in business is recovering fast (56% of the 1Q22 top-line was from foreign patients). The recovery has been strongest among CLMV and Middle Eastern markets. We estimate BH’s 2Q22 core profit at Bt762m, up by 260% YoY and 5% QoQ. The driver is fast-expanding fly-in business. Healthcare revenue is assumed at Bt4.3bn, up by 44.3% YoY and 4.8% QoQ. We expect foreign patient revenue of Bt2.4bn for 2Q22, up by 74% YoY and 6% QoQ (almost 80% of BH’s 2019 average quarterly number of Bt3.0bn). Residential GM should be 42%, up sharply from 36.1% in 2Q21 (when prices were deeply discounted) and up slightly from 41.6% in 1Q22.