Market analyst Sandeep Jain continues to be bullish on the healthcare sector. In yet another edition of popular TV show ‘Jain Sahab ke Gems’, he brings for Zee Business channel viewers a top stock from this space. While the stock is available at highly attractive valuations, he reveals to Managing Editor Anil Singhvi, why this stock has a great future, ahead.
Top Stocks To Buy: KMC Speciality Hospitals India Ltd
While Jain has been recommending stocks from different sectors, he has been particularly bullish on the healthcare sector. Some of his earlier recommendations include Apollo Hospital, Dr Lal Pathlabs and Metropolis. Today, he picked yet another stock from this sector, albeit at a much lower PE multiple, making it a prized scalp. This stock is KMC Speciality Hospitals India Ltd – a hospital with a strong presence in South India. This is a quality company which runs a hospital chain under the name Kauveri Hospitals and is very popular in Southern India, Jain said.
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The stock is available at a PE multiple of 30. The impact of June quarter results, which were lower than the expectations, have already been discounted, he said. The return on capital of this company at 32.90, is highest in the sector. The growth in profits over the last five years have been around 88 per cent. The growth in sales during this period is 20-30 per cent, Jain said. This is a virtually debt free company, a phenomenon rare in the hospital business, he added.
He recommended buying in this share at existing price. This stock is currently trading around Rs 23. He puts the target price at Rs 24.50 in the near term. He said that this stock has the potential to achieve Rs 30 level in 9-12 months from here.
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The technical analyst said that he thinks the range between Rs 18 and Rs 20 is a good range for accumulating this stock. Investors should not miss an opportunity to buy stocks of companies such as this, whenever there is an opportunity. He said that this company has excellent fundamentals.