Apollo Hospitals: A Strong Pulse in Q2 FY26 with Robust Growth and Strategic Expansion

Apollo Hospitals Enterprise Limited, a titan in India's healthcare sector, has delivered a commendable performance in the second quarter and first half of fiscal year 2026. The company's latest investor presentation and earnings call reveal a healthy financial trajectory, underpinned by strategic expansions and a concerted push into digital healthcare. For Q2 FY26, Apollo Hospitals reported a consolidated revenue of INR 6,304 crore, marking a significant 13% year-on-year growth. This robust top-line expansion translated into a 15% increase in consolidated EBITDA, reaching INR 941 crore, and an impressive 26% surge in Profit After Tax (PAT) to INR 477.2 crore. These figures underscore a period of sustained momentum and effective execution across its diverse verticals.

The growth narrative is well-distributed across Apollo's key business segments. The core Healthcare Services division, comprising its extensive hospital network, posted a 9% year-on-year revenue growth, contributing INR 3,169 crore. This growth was primarily driven by an improved clinical mix, higher average revenue per inpatient (ARPP), and increased revenue from CONGO (Cardiac, Oncology, Neurosciences, Gastro, Orthopaedics) specialties, despite lower seasonal medical admissions compared to the previous year. The Diagnostics & Retail Health segment (AHLL) also demonstrated strong performance, with its revenue growing by 17% to INR 473.9 crore and EBITDA improving by 21% year-on-year. The Digital Health & Pharmacy Distribution segment, operating under Apollo HealthCo, was a significant growth driver, registering a 17% revenue increase to INR 2,660.6 crore. Notably, the digital vertical saw a reduction in losses, moving closer to profitability.

Apollo's strategic blueprint for future growth is clearly articulated through its aggressive capacity expansion and digital transformation initiatives. The company plans to add approximately 3,600 census beds over the next five years, increasing its total operational beds to around 13,100. This expansion is phased, with new hospitals in Pune and Defense Colony already soft-commissioned in Q3 FY26, and others in Sarjapur, Calcutta, Hyderabad, and Gurugram slated for commissioning in Q4 FY26 and early FY27. Management anticipates initial EBITDA losses from these new units but aims for breakeven within 12 months of commissioning, reflecting a disciplined approach to capital allocation.

In the digital realm, Apollo is undertaking a composite scheme to restructure Apollo HealthCo, involving the demerger of its omnichannel pharmacy distribution and Apollo 24|7 digital platform into a new entity, followed by an amalgamation with Apollo Healthco Ltd and Keimed Private Limited. This strategic move aims to create an 'Indian Owned and Controlled Company' (IOCC) for listing by Q4 FY27, unlocking synergies and enhancing operational efficiency. The company is also leveraging artificial intelligence and digital command centers across its hospitals to improve operational efficiencies, patient outcomes, and bed utilization rates. These technological advancements are crucial for driving sustained margin growth and managing costs effectively.

Apollo Hospitals' Q2 FY26 performance highlights its strategic clarity and disciplined execution. The company is focused on deepening its leadership in core healthcare services, accelerating digital adoption in retail health, and expanding its network through strategic capacity additions. Despite minor headwinds such as seasonal medical admissions and the impact of reduced patients from Bangladesh, management's proactive measures, including exploring new markets and focusing on high-complexity cases, are effectively mitigating these challenges. With a clear roadmap for growth and a commitment to financial discipline, Apollo Hospitals is well-positioned to continue creating long-term value for its stakeholders, reinforcing its position as a leader in India's integrated healthcare ecosystem.