Domestic brokerage Avendus Spark Institutional Equities, in its latest note, has initiated coverage on Dr Agarwal’s Health Care one of the country’s largest eye care hospital chains, with a ‘buy’ rating and a target price of ₹495 apiece. This implies an upside potential of 18.35% from the stock’s Tuesday closing price of ₹418.25 per share.
The brokerage’s bullish outlook stems from the company’s strong position in the eye care market, growing network presence, and acquisition strategy.
As per the brokerage’s estimates, the Indian eye care services market is expected to grow at a 12–14% CAGR over FY24–28E, driven by the high prevalence of eye disorders and rising demand for surgical correction.
It also highlighted the company’s strong revenue growth, with a 32% CAGR over FY22–26E, primarily driven by a 37% CAGR in surgical revenues and supported by aggressive network expansion.
The brokerage further highlighted the company’s asset-light model, with most facilities on leased premises, resulting in lower capital intensity compared to multi-specialty hospitals.
On the financials front, the brokerage expects the company to deliver a 21% revenue CAGR over FY26–28E and estimates EBITDA and PAT CAGRs of 22% and 46%, respectively, during the same period.
Technical outlook: Experts see potential upside on breakout; advise caution amid near-term weakness
Ganesh Dongre, Senior Manager — Technical Research at Anand Rathi, said the healthcare stock has been sustaining above its September low of ₹407 and has formed a double bottom on the technical chart. He added that if the stock sustains above this double-bottom support and decisively breaks above ₹430, it can be assumed that the stock has bottomed out.
He further noted that a fresh buy is recommended above ₹430 for investors with a low-risk appetite. However, high-risk investors can buy the scrip at the current market price, targeting ₹465 to ₹470 and ₹495 to ₹500, with a strict stop loss at ₹395 apiece.
Those buying above ₹430 can maintain a stop loss at ₹405, while those buying at current levels are advised to upgrade their stop loss once the stock sustains above ₹430.
Osho Krishan, Sr Analyst – Technical & Derivatives Research at Angel One Ltd, said Dr Agarwal’s Health Care Ltd has recently witnessed a phase of corrective price action, with the stock slipping below its key EMAs on the daily chart, indicating near-term technical weakness.
He added that, from a support perspective, the 400 zone appears to be a critical level, and a decisive breach below this threshold could potentially accelerate selling pressure in the near term, leading to further downside.
On the upside, he said a sustained move above 465, aligned with the 200-DSMA, would be an important technical trigger, signalling a possible revival of buying interest and a shift in sentiment. Until such directional confirmation emerges, he advised maintaining a cautious stance on the counter.
Disclaimer: This story is for educational purposes only. The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
