/** blogpostTitle: Shalby Q4 FY26: MedTech turns profitable, hospitals steady, Gurugram still drags blogpostSlug: shalby-q4fy26 blogpostCoverImageDescription: Ultra-realistic corporate finance scene inside a modern boardroom: a large wall-mounted dashboard shows three clean charts without text labels. Chart 1 is a quarterly revenue bar chart rising from roughly 270 to 296 (INR crores equivalent) for the latest quarter. Chart 2 is an EBITDA line moving upward with a visible jump versus the prior year. Chart 3 is a segment mix donut chart showing three large sections and one tiny slice, reflecting hospital, international, and MedTech contribution. On a table, there are printed sheets with a balance sheet style layout and a highlighted net debt figure, plus a separate sheet showing an inventory-days trend line falling from very high levels. Neutral lighting, professional financial aesthetic, no logos, no readable words. blogpostShortTitle: Shalby Q4 FY26: MedTech turnaround focus */

Shalby Q4 FY26: MedTech turns profitable, hospitals steady, Gurugram still drags

Shalby ended Q4 FY26 with a cleaner consolidated profit profile, but the quarter also highlighted the group’s uneven operating picture. Consolidated revenue rose to INR 295.5 crores (up from INR 270.2 crores in Q4 FY25). EBITDA improved to INR 37.4 crores, and profit before tax came in at INR 9.6 crores versus a loss in the year-ago quarter. Reported PAT jumped to INR 18.5 crores.

Management linked a meaningful part of the profitability step-up to the shift to the new tax regime. On the earnings call, the CFO indicated that the group has moved to the new regime and expects a tax rate of about 25% versus about 35% earlier, describing it as a recurring benefit for profitability and cash flows.

At a segment level, the picture is clearer. The hospital business remains the anchor, Shalby International (Gurugram) is still loss-making, and Shalby MedTech delivered a notable turnaround with a second consecutive quarter of positive EBITDA.

Consolidated FY26: steady growth, better profitability

For FY26, the company reported consolidated revenue of INR 1,168.2 crores versus INR 1,114.6 crores in FY25, a 4.8% increase. EBITDA stood at INR 169.6 crores with a margin of 14.5%, broadly stable compared to FY25. PBT improved to INR 60.6 crores.

The biggest swing was in PAT, which rose to INR 34.7 crores in FY26 versus INR 1.9 crores in FY25. Management attributed the sharp improvement primarily to the tax regime shift, alongside operating improvements.

The balance sheet remains leveraged but not extreme by disclosed metrics. As of March 2026, consolidated gross borrowings were INR 539.6 crores and cash was INR 93.4 crores, resulting in net debt of INR 446.2 crores. Debt-to-equity was reported at 0.44x. Annualized ROCE for the quarter was disclosed at 7.3%.

Financial summary (as disclosed)

Q4 revenue mix: hospitals dominate, MedTech gaining share

Shalby provided a consolidated revenue and EBITDA breakup for Q4 FY26 that helps triangulate what is driving results. The combined bucket of Shalby hospitals, pharma and franchise contributed 79.16% of revenue in the quarter (INR 233.95 crores) and generated EBITDA of INR 34.22 crores.

Shalby MedTech contributed 13.55% of revenue (INR 40.04 crores) and EBITDA of INR 3.72 crores. Shalby International contributed 7.26% of revenue (INR 21.47 crores) but reported negative EBITDA of INR 0.36 crores.

The implication is straightforward. Consolidated margins will continue to be shaped by two moving pieces: whether Shalby International narrows its losses, and whether MedTech can hold profitability while scaling.

Hospitals: occupancy improved, but surgery volumes fell

Operationally, the hospital business showed mixed trends in Q4 FY26. In-patient volumes were slightly higher year-on-year (21,551 vs 21,202), but out-patient volumes declined (1,22,887 vs 1,31,271). Surgeries were down (6,909 vs 7,405).

Realizations improved modestly. ARPOB increased to INR 42,689 from INR 41,585, while ALOS increased to 3.81 days from 3.68 days. Occupancy rose to 48% from 45%. Management added that occupancy excluding the Gurugram international unit would be 50%.

The payor mix shifted toward government in Q4. Self-pay reduced to 33% (from 36%), TPA/insurance reduced to 37% (from 41%), and government increased to 30% (from 23%). On the call, management acknowledged the collection challenges typically associated with government business, though they also referenced recent revisions in CGHS rates and suggested a benefit could flow through in coming quarters.

A key operational point was the decline in operational beds to 1,365 from 1,415. In Q&A, management explained this was due to the closure of two SOCE units (Rajkot and Lucknow), which they said were EBITDA negative. The company positioned this as a margin-positive pruning decision.

Shalby International: losses persist, management confident but no timeline

Shalby International (Gurugram) remains the weakest part of the consolidated story. Q4 FY26 revenue fell to INR 21.53 crores from INR 22.81 crores in Q4 FY25. EBITDA improved but stayed negative (INR -1.96 crores vs INR -2.58 crores), while PBT and PAT were both INR -8.38 crores.

For FY26, revenue declined to INR 88.57 crores from INR 96.45 crores. EBITDA improved from INR -6.94 crores to INR -4.22 crores, but PAT remained deeply negative at INR -30.68 crores.

On the earnings call, management attributed part of the weakness to the geopolitical environment affecting international patient inflows from the Middle East. They also stated that growth in Asia and CIS countries partly offset the impact.

When asked directly about when the hospital would hit EBITDA breakeven, management said they are restricted from giving a timeline but expect improvement in the short term. They cited NABH accreditation received in February 2026 as a catalyst for better TPA tie-ups, potential rate increases, and renewals. They also said cost optimization measures have already lifted EBITDA versus FY25.

Notably, management mentioned an equity infusion of about INR 60 crores into the Gurugram unit in the recent quarter, increasing Shalby’s stake from about 87% to about 91%, which signals continued commitment to the asset.

MedTech: the turnaround is visible, but inventory is still heavy

Shalby MedTech was the cleanest positive surprise in the documents. In Q4 FY26, MedTech consolidated revenue rose to INR 40.04 crores from INR 27.59 crores in Q4 FY25. MedTech consolidated EBITDA improved to INR 3.72 crores from a loss of INR 9.34 crores.

For FY26, MedTech consolidated revenue reached INR 134.97 crores, up from INR 92.29 crores in FY25. EBITDA swung to a positive INR 6.70 crores from a loss of INR 19.17 crores.

Management attributed this to operating discipline and initiatives across COGS optimization, manufacturing efficiency, packaging, value engineering and supply chain restructuring. The MedTech CEO said the business has reached an inflection point, with platform creation and regulatory groundwork substantially behind them, and the next phase focused on scaling revenues and improving profitability.

The key risk marker is inventory. The presentation shows MedTech consolidated days of inventory at 934 in FY26, down from 1,153 in FY25, but still elevated. Total inventory rose to INR 345.4 crores in FY26 (from INR 291.4 crores in FY25) even as revenue grew. Management acknowledged inventory remains high as part of global expansion strategy, while stating inventory efficiency improved and will remain a focus.

The documents also outline a broad geographic ambition for implants. Existing markets listed include North America, Japan, India and Indonesia, with approvals received for Malaysia and Argentina, and regulatory approvals cited for South Korea, Vietnam and Iran. On the call, the MedTech CEO also mentioned progress in markets like Vietnam, Malaysia, Nepal, Iraq and Argentina.

In long-range commentary, management stated an ambition for MedTech revenue of INR 600 crores to INR 650 crores by 2030, alongside a target of double-digit EBITDA above 15%.

Capex and near-term posture

Management disclosed FY26 capex of about INR 160 crores, largely tied to oncology and radiation investments (LINAC bunkers) and the international business. They indicated FY27 capex should be materially lower because the heavy investment cycle has already played out in FY26.

They also suggested occupancy should improve beyond current levels and indicated it is likely to be better than 50% in the coming year. However, no formal quantitative guidance was provided for consolidated margins, debt, or segment profitability timelines.

What to track from here

Shalby’s FY26 documents show a company trying to stabilize the group structure after two acquisitions, while simultaneously building a second growth engine through MedTech. The hospitals business remains the cash and revenue base, but volume recovery needs to follow recent investments, especially in oncology and super-specialty additions.

The biggest watch items remain Shalby International’s path to breakeven and MedTech’s ability to scale without prolonged inventory and cash drag. With a lower tax rate now in place and lower capex expected in FY27, the next year should test whether operating leverage translates into stronger ROCE and a healthier consolidated cash profile.