Healthcare

Healthcare: The Straits Times reported that Spore public hospitals are facing a “severe bed crunch”. With bed occupancy rate exceeding 100% on certain days over the recent festive season, some hospitals have had to resort to measures such as setting up beds along the corridors, diverting patients to other hospitals, and creating air-conditioned tent waiting areas. The private hospital operators such as Raffles Medical and IHH are the likely beneficiaries of the sudden spike in hospital demand. Over the longer term, demand for healthcare will continue to rise in S’pore, and private healthcare providers can be expected to play an increasingly important role in alleviating the strain on Spore’s public services. For instance, recent government-led healthcare reforms, such as allowing Medisave claims for certain outpatient treatments have also been extended to private hospitals. Maybank-KE remains positive on the private healthcare sector. Raffles Medical is a top pick (Buy, TP $3.80) due to its long-term earnings resiliency, hospital expansion plans and attractive valuations.