Raffles Medical Grp: Nomura maintains Buy with $2.52 TP, following grp’s 3Q10 which was inline with expectations, albeit on the lower end of consensus estimates. Notes that continued demand for private healthcare in the region will support long-term prospects for SG healthcare service operators….
Highlights further room for upside in terms of average inpatient bill size, with Raffles showing a mark growth of 40% from 2007-09, nothing that there is still a gap between the Parkway hospitals and Raffles for surgical specialties, implying that there is room for the later to improve its surgery offerings….
Other potential catalysts includes regional expansion via M&A or Greenfield activities and grp’s Net Cash position of $72m, with Nomura citing that grp’s 30% premium over peers valuation is justified give grp’s visible growth profile. Similarly, CIMB maintains Outperform rating on stock….
We note however that Deutsche and CS are less upbeat on the stock, downgrading grp to Sell and Neutral rating respectively with TP of $1.76 & $2.10
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