Raffles Medical Group’s 1Q16 results largely met our expectations, with 1Q typically being the weakest quarter. Revenue grew 23% YoY to S$116.9m, forming 24% of our full year estimate, as both the Healthcare and Hospital Services divisions saw their segment revenue increase 36.3% and 15.2% respectively.

This was driven by higher patient load, increased contribution from more specialist consultants as well as from International SOS (MC Holdings) and its subsidiaries (MCH). Due to higher costs from several fronts including staff costs, PATMI was up 3.7% to S$15.5m, meeting 19% of our FY16 forecast.

We are keeping our BUY rating and fair value estimate of S$4.72, pending more information from the analyst briefing later today.

Source: OCBC Research - 25 Apr 2016