Dr Agarwals Health Care Q1 FY27 Earnings Call: Record 18 Greenfield Launches, Merger Close Expected Mid-November (AGARWALEYE)

Dr Agarwals Health Care Ltd held its Q1 FY27 earnings call on August 04, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Record Revenue and Margin Expansion Amid Aggressive Greenfield Launches

• Revenue from operations of Rs.614 crore in Q1 FY 2026-2027, up 26% YoY and 8.8% sequentially; total income reached Rs.620 crore (+24% YoY).
• EBITDA of Rs.177 crore (margin 28.5%, +30 bps YoY); PAT margin expanded 127 bps to 8.9% despite rising greenfield losses in the quarter.
• Profit after tax attributable to owners improved to 82.2% in Q1 FY 2026-2027 (from 79% in Q1 FY 2025-2026), driven by lower finance costs on deferred consideration.
• Served 8.8 lakh patients and performed 90,000+ surgeries in Q1 FY 2026-2027, with daily footfall of nearly 12,000 patients across the network.
• Employee costs rose to 34% of revenue in Q1 FY 2026-2027, reflecting investments in clinical talent at new centers; other expenses held stable at 16.8%.

Record 18 Greenfield Launches in a Quarter; Network Reaches 285 Facilities

• 18 greenfield facilities launched in Q1 FY 2026-2027 (including 16 surgical centers, a record quarter), taking the total network to 285 facilities across 14 states and 5 union territories covering 165 cities.
• Full-year FY 2026-2027 target of 60 new facilities (including 40 surgical centers): Q1 delivered 18, Q2 target is 12, and H2 target is 30; management cited 30+ signed LOIs in the pipeline.
• South region contributed Rs.387 crore in Q1 FY 2026-2027 (+22.8% YoY, 63% of group revenue); West Rs.91 crore (+24% YoY), North Rs.57 crore (+50.5% YoY), and East Rs.16 crore (+21% YoY).
• North India surgeries grew ~25% on average over the three quarters ending Q1 FY 2026-2027, driven by Delhi NCR expansion (from 1 branch in FY 2025-2026 to 7 currently) and a favorable base in Punjab.
• Delhi NCR surgical centers remain in early scale-up phase; management noted a ~3-year horizon to reach maturity comparable to South India centers.
• Vintage-wise revenue breakdown: pre-FY 2023 facilities contributed Rs.465 crore (+16.3% YoY, 75.9% of group); FY 2024 vintage Rs.48 crore (+19.6% YoY); FY 2025 vintage Rs.62 crore (+38.6% YoY); FY 2026 vintage Rs.33 crore (early ramp-up).

High-End Procedures Drive Realization; Cataract Mix Shifts Upmarket

• Surgical volumes reached ~91,000 in Q1 FY 2026-2027 (+15.5% YoY), with cataract surgeries growing 16.5% YoY and accounting for 74% of total surgeries.
• High-end cataract surgeries comprised 29.3% of total cataract procedures; robotic cataract (femto) grew 33.4% YoY and refractive surgery (Smile) grew 36.2% YoY.
• Retinal surgeries crossed 3,861 (+30% YoY) and corneal transplants reached 285, the highest-ever quarterly volume for the company.
• Average realization per surgery reached ~Rs.44,000-45,000 in Q1 FY 2026-2027; cataract realization alone grew to ~Rs.42,000 from Rs.28,000-30,000 four years ago, driven by insurance, disposable income, and technology upgrades.
• Pinhole pupilloplasty (PPP) innovation: 500+ procedures performed in FY 2025-2026, with 94% of patients experiencing significant visual acuity improvement; management positioned it as a potential alternative to corneal transplantation.
• Femto cataract margin mechanics — management noted the additional charge of ~Rs.35,000 per procedure versus a license click fee of ~Rs.10,500-11,000, implying rupee gross margin expansion as mix shifts.

Gross Margin Improvement and Finance Cost Tailwind Offset by Employee Cost Uptick

• Gross margin improved ~1% in Q1 FY 2026-2027 versus Q1 FY 2025-2026, driven by a drop in COGS and a higher contribution from surgery revenue.
• Finance cost decreased sharply from Rs.24.7 crore in Q1 FY 2025-2026 to Rs.12.5 crore in Q1 FY 2026-2027, partly due to a reduction in interest on deferred acquisition payable (Rs.6.8 crore to Rs.3.6 crore) after a Rs.25 crore payment in Q1.
• Interest cost on lease liability stood at ~Rs.18 crore for Q1 FY 2026-2027; acquisition and liabilities payment for the quarter was ~Rs.24-25 crore.
• Doctor count grew 23% YoY to 1,057 in Q1 FY 2026-2027, with 100 new doctors added in the last four months; overall attrition is 16-17%, but senior doctor attrition is very low at 2-3%.
• Same-store sales growth (FSSG) for facilities up to FY 2022-2023 was 16% in Q1 FY 2026-2027, split equally into ~8% volume growth and ~8% value growth; OPD contributed ~6% and conversion ~2%.
• Management noted that achieving FSSG of 12-13% is considered "phenomenal" and commended the team for delivering 16.3% FSSG in Q1 FY 2026-2027.

60-Facility Target, Merger Timeline, and Sustained Growth Ambition

• Full-year FY 2026-2027 facility target of 60 new openings (40 surgical centers) reaffirmed; Q1 delivered 18, Q2 target is 12, and H2 target is 30, with 30+ signed LOIs in the pipeline.
• Management expects to sustain growth momentum for FY 2026-2027 and beyond, supported by deeper micro-market penetration, geographic expansion, and adoption of advanced surgical technologies.
• CEO Dr. Adil Agarwal stated the merger is expected to close approximately mid-November during FY 2026-2027.
• Payer mix in Q1 FY 2026-2027: cash 63.6%, insurance/TPA 27.7%, and government schemes 8.6%; management is actively working on improving the pace of new center additions for the remainder of the fiscal year.
• New centers in early ramp-up phase — FY 2026 vintage facilities contributed Rs.33 crore in Q1 FY 2026-2027, with management noting they are still in early scale-up and will take time to reach mature profitability levels.