Health is profit, (Update I)

Singhe Hospitals Limited (SINH.N0000) has now issued their first set of financials to the public as a listed entity. It’s now time to have a look at the projections and the actuals as well as revisit the valuation. Firstly, I would like to provide the Price Volume chart for SINH. As per the available data, it has traded LKR2.20 at the lowest and LKR2.80 at the highest.

For the year ended 31 March 2015, SINH recorded revenue of c.LKR234.89 a growth of 43% year-on-year. However, this compares with the projections (provided in the prospectus and prepared by the auditors) that I used in my valuation at the time of IPO as follows.

They were c.LKR22.8 million behind the forecasts or c.9% behind. Further, EBIT margin for FYE15 came in at negative 13.30% as opposed to the projections of -2.15%.

Accordingly, I have revised the inputs in the valuation model and hence the valuation has come down.