What factors can drive Bangkok Dusit Medical Services FY2024 performance?

The group’s revenue is forecasted to see a 10.2% growth.

Bangkok Dusit Medical Services (BDMS) is projected to witness steady growth for the year amidst gradually improving its profitability post-pandemic, according to a UOB Kay Hian (UOBKH) report.

The report revealed that this growth is attributed to the return of international patients due to lifted travel restrictions and hospital operations normalising after the COVID-19 outbreak.

However, the group is anticipated to see a quarter-on-quarter (QoQ) drop in the second quarter (Q2) due to seasonality driving higher costs, particularly personnel costs.

“There are many public holidays in Q2, so BDMS’ staff cost is expected to rise sharply QoQ due to the increase in overtime pay to continue operating the hospitals,” UOBKH said.

Meanwhile, a surge in insurance is expected to boost patient volume, driven by the increasing awareness of the importance and need for health coverage. This follows a downward trend of self-payors which can potentially lead to higher admission rates for covered treatments.

Moreover, high treatment prices of Centres of Excellence (CoEs) are expected to yield high profitability, with BDMS’s combined COEs in Thailand (13) and Cambodia (1) contributing to around 62% of its EBITDA in the first quarter.

“They often come as part of a medical tourism package to attract fly-in patients as well as expats who often come for more complex treatments, resulting in more profitability for BDMS,” UOBHK added.

Furthermore, these CoEs are located in tourist destinations such as Pattaya and Phuket which face less competition in comparison to the country’s capital, Bangkok.

Overall, UOBHK estimates BDMS’s revenue to witness a 10.2% growth for this year, whilst total capex is forecasted at 9.2% of total revenue.