Dr. Agarwal’s Health Care Limited reports Rs 234 crore outflow

Dr. Agarwal’s reported Rs 234 crore of net cash used in investing activities in H1’FY27, up from Rs 136 crore in H1’FY26, after capital expenditure reached Rs 279 crore and business-acquisition payments totalled Rs 71 crore, taking these two cash uses to Rs 350 crore.

Why did Dr. Agarwal’s investing cash outflow increase?

Dr. Agarwal’s investing cash outflow increased because capital expenditure rose by Rs 59 crore year on year and business-acquisition payments increased by Rs 11 crore. Capital expenditure towards tangible and intangible assets, including capital advances and net of capital creditors, was Rs 279 crore in H1’FY27 against Rs 220 crore in H1’FY26. Payments towards acquisition of businesses, including acquisition liabilities paid, were Rs 71 crore versus Rs 60 crore a year earlier.

Together, capital expenditure and acquisition payments amounted to Rs 350 crore in H1’FY27, compared with Rs 280 crore in H1’FY26. The reported net cash used in investing activities was lower than this gross deployment because the investing section also included a Rs 85 crore sale/(purchase) of investments line and Rs 32 crore under other items.

The other-items line in investing activities declined to Rs 32 crore in H1’FY27 from Rs 78 crore in H1’FY26, while the sale/(purchase) of investments line increased to Rs 85 crore from Rs 66 crore. The presentation does not provide a transaction-by-transaction allocation of the Rs 279 crore capital expenditure or the Rs 71 crore acquisition payment.

The higher deployment accompanied network expansion. Dr. Agarwal’s had 324 facilities in H1’FY27, compared with 258 in H1’FY26, while facilities in India increased to 305 from 239. The company also reported 172 emerging facilities in H1’FY27, up from 135, with emerging facilities defined as those operated for fewer than three years.

How did operating cash generation compare with investment spending?

Dr. Agarwal’s generated Rs 280 crore of net cash from operating activities in H1’FY27, up Rs 18 crore from Rs 262 crore in H1’FY26, but this was below the Rs 350 crore combined capital expenditure and acquisition payments. Operating cash generation nevertheless exceeded the Rs 234 crore reported net investing outflow because of the other investing cash-flow lines.

Operating cash flows before working-capital changes rose to Rs 368 crore in H1’FY27 from Rs 291 crore in H1’FY26. Cash generated from operations increased to Rs 319 crore from Rs 301 crore, and net taxes paid were unchanged at Rs 39 crore in both periods, producing Rs 280 crore of net operating cash flow.

Working-capital movements changed across several categories in H1’FY27. Trade receivables used Rs 41 crore of cash, compared with Rs 25 crore in H1’FY26, while inventories used Rs 14 crore after contributing Rs 2 crore in the earlier half-year. Other financial assets moved from a Rs 36 crore cash inflow to a Rs 13 crore outflow, while other current liabilities, other financial liabilities and provisions contributed Rs 37 crore, versus Rs 15 crore.

The cash-flow comparison coincided with higher reported earnings. Revenue from operations rose 28.7% to Rs 1,269 crore in H1’FY27 from Rs 986 crore in H1’FY26, while earnings before interest, tax, depreciation and amortisation, or EBITDA, increased 27.0% to Rs 362 crore. Profit after tax rose to Rs 112 crore from Rs 75 crore, although the cash flow from operations to EBITDA ratio declined to 77.3% from 91.8%.

What changed in Dr. Agarwal’s assets, funding and network?

Dr. Agarwal’s total assets increased by Rs 265 crore to Rs 4,207 crore at H1’FY27 from Rs 3,942 crore at FY26, led by a Rs 316 crore increase in non-current assets. Property, plant and equipment, including capital work in progress, increased by Rs 185 crore to Rs 1,346 crore.

Right-of-use assets increased by Rs 61 crore to Rs 861 crore between FY26 and H1’FY27. Goodwill rose by Rs 32 crore to Rs 768 crore, and intangible assets increased by Rs 21 crore to Rs 438 crore, alongside the Rs 279 crore H1’FY27 capital-expenditure cash outflow.

Dr. Agarwal’s cash, cash equivalents and bank balances declined to Rs 101 crore at H1’FY27 from Rs 129 crore at FY26, while investments fell to Rs 71 crore from Rs 152 crore. Total borrowings, combining current and non-current borrowings, increased to Rs 201 crore from Rs 157 crore. The H1’FY27 cash-flow statement recorded Rs 43 crore of net proceeds from borrowings, compared with Rs 67 crore of net repayments in H1’FY26.

Network and clinical activity also expanded over the H1 comparison. Surgeries performed rose to 1,86,923 in H1’FY27 from 1,57,281 in H1’FY26, including 1,37,170 cataract surgeries. Patients served increased to 18,43,809 from 14,35,024, and the doctor count rose to 1,111 from 881.

Conclusion

Dr. Agarwal’s H1’FY27 cash flow shows operating cash generation being directed to a larger capital programme and business acquisitions. Net operating cash rose to Rs 280 crore, while capital expenditure and acquisition payments reached Rs 350 crore and the reported net investing outflow increased to Rs 234 crore.

The next disclosure to watch is whether Dr. Agarwal’s hub-and-spoke model continues to support network growth across its 305 facilities in India and 19 international facilities. Management describes the model as a way to deepen geographic penetration and deploy critical resources efficiently, while future periods can show the pace of facility additions, acquisition payments and capital expenditure after the Rs 350 crore H1’FY27 deployment.