Ladies and gentlemen, good day and welcome to Max Healthcare Institute Limited earnings conference call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Suraj from CDR India. Thank you, and over to you, Mr. Suraj. Thank you. Good morning, everyone, and thank you for joining us on Max Healthcare Q3 and 9M FY26 earnings conference call. We have with us Mr. Abhay Soi, Chairman and Managing Director, Mr. Yogesh Sareen, Senior Director and Chief Financial Officer, and Mr. Keshav Gupta, Senior Director, Growth, M&A, and Business Planning. We will begin the call with opening remarks from the management, following which we will have the forum open for an interactive Q&A session. Before we begin, I would like to point out that some statements made in today's discussion may be forward-looking in nature, and a disclaimer to this effect has been included in the earnings presentation shared with you earlier. I would now like to invite Abhay to make his opening remarks. Thank you, and over to you, Abhay. Good morning, everyone, and thank you for joining us on Max Healthcare earnings call for the third quarter and nine months ended December 2025. We are pleased to share that the network delivered its 21st consecutive quarter of year-on-year growth in Q3, despite excessive unanticipated seasonal softness due to lack of vector-borne diseases and transitory external factors. Revenue increased by 10% year-on-year, while operating EBITDA grew by 4%. Overall occupancies remained strong, and ramp-up of the new brownfield beds progressed in line with our expectations. During the quarter, we commissioned 63 brownfield beds at Nanavati Max, of which 45 beds are currently occupied. At Max Mohali, 53 brownfield beds were commissioned in the second quarter, of which 46 beds are currently occupied. The remaining beds at both hospitals are expected to be commissioned during the fourth quarter of this current year, FY 2026. The incremental bed capacity at both these locations is already EBITDA and margin accretive. At Max Saket, infrastructure for around 200 beds, along with operating theaters and OPDs, is ready for commissioning, and we are currently awaiting the occupancy certificate, which is expected by the end of February. We also took an important step to expand our geographic presence in Western India to develop a 450-bed hospital on a prime piece of land in Pune, and this will be developed by 2030. In addition, driven by the exceptional ramp-up in operations at Max Dwarka, the board has approved the addition of another 260 beds at the existing site, taking the hospital's total capacity to 560 beds. On a sequential basis, revenue and EBITDA were impacted primarily due to a temporary shift towards institutional patients following the disruption in cashless services with standalone health insurers, which was fully restored towards the end of the quarter. Performance was also affected by the discontinuation of select high-value patented chemotherapy drugs in light of the revised CGHS pricing guidelines and by the reduction in GST on drugs and consumables. Further, the results reflected pre-commissioning expenses related to brownfield bed additions and other non-recurring costs. Looking ahead, with cashless services now fully restored, upward revision in CGHS tariffs expected to fully kick in by April 2026, and margin accretive incremental capacity coming on stream, we believe the network is well-positioned to continue delivering sustained growth. Now, coming to the third quarter performance highlights. Average occupancy for the network stood at 74% compared to 75% in third quarter last year and 77% in the trailing quarter, despite an 8% year-over-year increase in operational bed capacity. Occupied bed days were up by 7% year-over-year but dipped by 4% quarter-over-quarter due to seasonality. Average revenue per occupied bed (ARPOB) for the quarter was INR 77,900, registering a 3% growth year-over-year and 1% sequentially. Network gross revenue stood at INR 2,608 crore compared to INR 2,381 crore in the third quarter last year and INR 2,692 crore in the previous quarter. This reflects an increase of 10% year-over-year. Digital revenue from online marketing activities, web-based appointments, and digital lead management was INR 803 crore, accounting for approximately 31% of overall revenue. Website traffic crossed 7,100,000 sessions during the quarter, growing by 44% year-over-year. International patient revenue was INR 230 crore, registering a growth of 14% year-on-year and accounting for 9% of the revenue from hospitals. Network operating EBITDA stood at INR 648 crore, reflecting a growth of 4% year-on-year. Network operating EBITDA margin was 26.1% for the quarter compared to 27.3% in the third quarter FY25 and 26.9% in the trailing quarter. Margin was largely impacted by payer mix change, pre-commissioning expenses for brownfield beds, and GST rate changes. Annualized EBITDA per bed for the network stood at INR 71 lakh versus INR 73 lakh in both third quarter FY25 and the previous quarter. Profit after tax for the network after exceptional items was INR 344 crore against INR 316 crore in the third quarter last year and INR 554 crore in the previous quarter. During the quarter, there were exceptional items aggregating to INR 55 crore relating to impact of the Code on Wages 2019 and provision for stamp duty on the merger of two of our subsidiaries. The network generated free cash flows of INR 281 crore during the quarter. INR 408 crore was deployed towards ongoing capacity expansion projects and facility upgrades and newer units. Net debt for the network stood at INR 2,166 crore compared to INR 2,067 crore at the end of September 2025, while the net debt-to-EBITDA ratios continued to be less than one. Continuing our efforts to support the local communities, we provided free treatment to approximately 40,000 patients from economically weaker sections of the society, worth INR 61 crore at hospital tariff. Both our strategic business units continue to deliver steady growth in revenue and profitability. First, Max @ Home reported a revenue of INR 68 crore, reflecting a robust 23% year-on-year growth. It offers 16 specialized service lines across 15 cities, with over 56% repeat transactions. Max Lab reported a revenue of INR 47 crore, reflecting 13% year-on-year growth. It provides services in over 60 cities and serves more than 5 lakh patients during the quarter. Now, moving on to the status of our expansion projects coming on stream in the next two to three years. Max Lucknow, the current capacity of the hospital stands at 413 beds, and we expect this to increase to around 500 beds by the end of this financial year. The radiation bunker and nuclear medicine services have now commenced at the hospital. 500 beds at Sector 56, Gurugram. The pace of work at site has picked up post-GRAP-related disruptions. We now expect to commission the first phase by the end of H1 FY 2027. 100 beds at Nagpur, we have received consent to establish, and civil work has started. We expect to complete this project within 24 months, as communicated earlier. 400 beds at Zirakpur Mohali, project work continues to be on track, and we are scheduled to commission the hospital in FY28. 200 beds at Max Vaishali, we are awaiting environmental clearance and approval of building plans to commence the work on site. We expect to complete the project in 24 months post-receipt of these approvals. 397 beds at Patparganj, all approvals have been received, and barricading work is complete. New design for D-wall has been firmed up, and the project is now expected to be completed by FY29. Finally, coming to the overview of the company's performance for the nine months ended December 2025. Network gross revenue stood at INR 7,874 crore, reflecting a strong growth of 19% year-on-year. Overall network operating EBITDA grew by 16% year-on-year to INR 1,956 crore, translating to a margin of 26% and EBITDA per bed of INR 71 lakh. In the nine months, we generated INR 960 crore of free cash flow from operations after interest, tax, working capital changes, and routine CapEx. Further, INR 1,299 crore was deployed towards ongoing expansion projects and facility upgrades at newer units, INR 131 crore towards land purchase at Vaishali, and INR 146 crore was distributed as dividend. With this, we open the floor for any questions you may have. Thank you. We will now begin the Q&A session. Anyone who wishes to ask a question may press star and one on your touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Damayanti Kerai with HSBC. Please go ahead. Hi. Thank you for the opportunity. My first question is on your oncology contribution. So during the quarter, obviously, we saw some softness, which you attributed to discontinuation of patented chemo drugs for institutional patients. So do you think you can go back to the prior level of contribution from oncology, and what could drive it back? Well, when you say contribution, this is high-value drugs. So the pricing was high in terms of the revenue, but the margins were not substantive, I mean, compared to the rest of the business. So do you mean in terms of revenue, or do you mean in terms of margins? In terms of revenue, I think yeah. Yeah. When we look at the contribution from oncology, I think which is part of the presentation, it's around 24% or so compared to 26%-27% last year. So I was referring from that context. So this impacts CGHS patients only, I mean, the institutional patients. So this is the high-value drugs, okay, which were low-margin drugs, which were being used for actually the institutional patients. What they've done is actually now you have to sell them below your purchase cost. So obviously, everybody's discontinued it. And the contribution to the revenue mix may increase, but it's a future traditional number. Just like it was increasing in the past as well for the last four, five years as an outcome of what was happening in the society, right? So directionally, will the number increase? It should follow the same trajectory, but let's see. Okay. We see this as one-time adjustment, and then going ahead, the growth will be continued. So we continue to talk to CGHS, right? So there's a lot of noise among the CGHS patients, among the institutional patients, right? For example, the CGHS has their own dispensary to supply these medicines. They said that they will like to supply these medicines to the patients. That means when the doctor this drug is required, then the doctor writes a prescription. They take it to the dispensary, bring the medicine from the dispensary, CGHS dispensary, right? Now, similar tariffs have been applied to ECHS patients also, but ECHS doesn't have any dispensary, right? So obviously, there's a lot of noise out there. I think let's see how these things shape out. But we are in continuous discussion with the CGHS. Obviously, they want to first supply it themselves. Certainly, they are saying, "Otherwise, we will deliver to you at 70% of the MRP," right? Our margins are less than 20% in these drugs. So there's no question of oversupplying these drugs, right? I can't be cashed out of these drugs while supplying these drugs. So I think that's where the discussion is on. We are asking CGHS to give us some top-up in terms of cost-plus basis, right? So if my cost is, let's say, INR 80, then I'm saying, "Give me some margin, 10%. I'll be quoted to supply at INR 88 rupees rather than supply at INR 70," right? Because I'm buying at INR 80. See, we believe it is an error on their part when they revise the CGHS rates. This is something which doesn't make sense because if these are branded drugs, and if your margins are, let's say, less than 20%, way less than 20%, then and you have to supply them at a 30% discount to MRP, then obviously, nobody's going to supply, and you're going to have a problem. So we've been talking to them, but because it's the government and everybody sort of agrees, but I guess you have to go through the hoops. Sure. And in oncology, again, I guess we heard about some doctors' team departure, etc. So has the team fully back in strength, and what kind of further pickup we can see in the oncology space, leaving aside the CGHS issue, which will, I think, be cleared in some quarters to come? See, typically, what happens is that in organizations like ours, if there is a departure of a certain clinician of a particular discipline, there are almost immediate replacements from equivalent institutions. So in this particular case, while you may have heard of the noise of departure, there's already been an addition, and there were big advertisements in the papers. You may have seen it. So we had a very, very large team who just joined us from a peer who sort of replaced that particular team, who's actually gone to that peer. So it's effectively been a swap effect, so. Yeah. My last question is on your graduation with the insurance partners. So have you done renewing all the insurance contracts for this cycle, and you have nothing pending on that part? As you mentioned, I think it's yeah. Two things or three things. I mean, of course, this was disruptive in some manner to us in this quarter. It didn't happen in the previous quarter, but it was. You may have also read in the papers today that number of complaints of insurance companies has actually moved up by 54% in this quarter. Obviously, there was a lot of noise because of this sort of disruption. All of it has been restored. We have got an increment, and there's also a mechanism which has been put in place that there will be annual increments rather than sort of now having sunset periods. Typically, your insurance contracts expire, and those negotiations take time. Now a process has been put in place where, at least with these insurance companies, there's automatic renewal on pre-agreed sort of increments. These annual increments, it's already pre-agreed, or how this mechanism will work out? That's right. Okay. It's an annual revision for all the contracts now instead of, say two to three years cycle earlier? Well, not all. These are only the PSU companies. Ones where we had the issues, right? So you know the whole issue started from the tariff revision. We were asking for price increase. They were asking for price reduction. That's where this whole stalemate started. So eventually, we got a price increase. And also, while we got the price increase this time, we also sorted it out for the next year. Next cycle, I would say. So there's a mechanism in place now. So hopefully, they'll live up to it. And so we shouldn't have the same kind of stalemate coming up there. But this is only with the companies that we had problem with, right? Four companies, basically. How many companies? Sorry, four companies. Four insurance companies. Four insurance companies. Okay. Okay. Thank you. So now with those four, there's not only this thing, but like Yogesh has said, this was an issue at the end of a cycle. Now a mechanism is put in place that you have automatic renewal of that. So we shouldn't have these issues coming into the next cycle or anything like that now. Got it. Thank you, Abhay. Thank you. Thank you. Next question comes from the line of Shaleen with UBS. Please go ahead. Yeah. I'm audible? Hi, Shaleen. Hi. Hi, sir. So yeah, continuing from some of the questions asked by the previous participants, possible to get the concept of increment, or at least can we compare what kind of increment will we get in compared to the past years for insurance companies? So Shaleen, tough to really decide on the call like this, right? So we got an increment, right? That's for sure. It's a moderate one, but then I won't give you a number. Okay. Okay. But is it in the ballpark of the kind of increment which we? It's in the ballpark of what? Yeah, yeah. It's not adverse. Yeah. It's not adverse. Great. So. It is in the ballpark of what you will see. It's an upper revision, and it's in that same ballpark, yeah. Yeah. Got it. Sir, one concern which we kind of, there's a debate. This happened with these four companies. Can it happen with others as well? So do you think that first, do you think that can happen? Second, do you think that this kind of mechanism can smoothen out? Are you trying to do this? I think clearly, there are learnings when something like this happens, right? I think it has also led to a lot of noise both ways and inconvenience to patients, not only our patients but also to insurance patients. And you would have read there's a big article in ET today about the number of complaints which have sort of increased. And hopefully, everybody sort of kind of learned from it. By the end of the day and I keep saying this. I say, "Look, medical inflation is in very low single digits. If your ARPOB is only 8% or 9%, typically, which historically has been growing, that has included growth in oncology by 25-odd%, growth in robotics by 40-odd%, growth in international patients, etc. So I mean, if you actually back it all off, what is the real growth in apples-to-apples medical costs? Then you apply it to 70% because 30% is at MRP in any case, which are drugs, right? So I don't think there is much sort of play there. I mean, you hear anecdotally these issues, those issues, and so on and so forth. But the fact of the matter is, apples-to-apples inflation has only been this much, right? Sure. Sure. Sure. Fair enough. Fair enough. Moving on, I heard part of your initial commentary. Maybe I missed something. I heard that you talked about a better contribution from Nanavati and new facility from Nanavati and Saket is already accretive. So is it fair to us or is it possible to understand that obviously, when you started these things, there will be some incremental cost which would have hit you in the quarter? Is it possible to quantify that kind of a cost which would? So I think what happens is that see, and this is something we've guided to in the past where people have sort of had concerns or capacity expansions, etc. We've always said that essentially, what you're doing is you're moving cash from your balance sheet, and you're creating an asset, right? Because of the operating leverage, it is almost I mean, you don't have suppression of margins. In fact, the breakeven is almost immediate, and it's accretive also very, very quickly, okay? And this is what we've seen in the past, and I think this is what we demonstrated by both of these. The cost, I mean, whatever little cost there is also, for every incremental bed which gets commissioned now, okay, your margins will only expand. And we've had 39% and 30%, respectively, I think, margins from both these units, okay, where we only started about 50-odd, 70-odd beds, right? I mean, as you are going to be adding beds, and all of those beds are coming through now as we speak and will be all through before end of March. So you're going to see a big you should have a you should continue on this accretive journey. Now, the question is, what is the sort of this thing? Now, if we've had GRAP for delays and etc. in this thing, and yes, of course, we've, I think, built close to 2.5 million sq ft over the last three, three and a half years, Keshav, okay? And the fact of the matter is, there has been a delay of three to four months, I think, collectively if you look at it. Nothing has actually moved out more than six months from a timeline standpoint. At one point in time, yeah, I mean, this is what we had guided in terms of time, etc. On the other standpoint, you look at it, okay, three year projects that take another four to five months, but it's perhaps faster than what most developers deliver from that standpoint. We, of course, continue to ask more of ourselves, and there's been a lot of learnings in this. The fact of the matter is that pre-commissioning, okay, those costs have been sitting in your distinct, but it's not as if they're sitting and not contributing. If you bring doctors along, they perhaps don't contribute as much, but they do contribute to the previous facility. So it's a little difficult to dissect the costs from that standpoint because there's no management cost like I already explained, okay? Largely, the clinician cost is the same. Now, you're going to bring housekeeping people. You're going to bring nurses. You're going to train them up, the front-end staff, and so on and so forth, okay? But they're also training in the current facilities. You're overstaffed in the current facility, and then you're going to start to move them into the new one. So I mean, it's a little difficult to thread that cost out because it's not like a typical greenfield. Sure. Sure. See, basically, the reason to ask, see, a lot of things have happened in the third quarter, and that has kind of hurt our profitability. We understand that there's going to be a step jump from the third quarter to the fourth quarter in terms of profitability because a lot of things have been corrected, and even new specific companies. It will help us to understand what kind of a step jump because one, your operating leverage. No, I think the big yeah. So I think these are the smaller factors which have affected the profitability. If you ask me the two big factors perhaps which have affected it, in my mind, would be first and foremost is the seasonality, right? Last year, right up till Diwali, we had a very, very strong vector-borne season, okay, and large occupancies because of dengue and so on and so forth, which has happened historically as well. This year, okay, there wasn't really I mean, this rainy period continued straight into winter, and there was no real stagnation of water from that standpoint. Normally, what happens is your rainy season gets over. There's a humid sort of distinct, and then winter starts. So in this period is when you have the vector-borne diseases. But this year, the rains continued right into the foot of winter, and then winter started. So there was no humid period for that kind of so we've had very bad seasonality. So I mean, you've seen results of other sort of companies as well, particularly north-based companies, and you'll see this effect. And the second was, of course, disruption. Now, when the disruption happened of the SAHI companies, we've replaced all of that with institutional because that's the easier part to replace it with. So you see your institutional businesses move up, right? So your occupancy didn't get impacted, but your quality of revenues got impacted, and therefore, your profitability. Got it, sir. Got it. So Abhay, any sense on this quarter, like fourth quarter, since we are almost end of February, right? Yeah. I'm not going to give you a guidance. I've never given a guidance on forward-looking numbers. But we typically only give it in terms of the new capacities which can come in and what the current sort of run rate of that is like in the past. So I will continue on. Sure. Okay. Last question from my side, if I can. And this is more on the industry-level question. See, so a lot of debate, again, in this sector is too much capacity is coming, too many hospitals are coming, and inside the micro-market, the concerns, for example, Gurgaon, right? And hospital, it's not just the local market. It's also the intercity market because I also come from north, right? So I know that. But what's your take on it, right? Do you think that a lot of hospitals coming in Gurugram can impact Saket, or customer sets are different? Or do you think there will be enough demand because there is enough intercity travel happening? So I just wanted to hear your thoughts. So look, I think there are two or three things over here. I think if you look at it on a holistic level, okay, I think over the next four to five years, there are about 22,000 beds which are coming up across the country, right? So I mean, it doesn't really move things over so over five years, it's a capacity increment of, let's say, a CAGR of about, I think, 5% per year. If I look at okay, let's look at specifically Gurugram. Now, if a couple of hospitals are coming up in Gurugram, and we happen to be actually one of them, right? So I think I'm less likely to sort of take a hit at Saket or anywhere else because if any of my doctors want to move to Gurugram, then they will choose my hospital, right? This is sort of easier if that location advantage is valuable to somebody. Sure. Sure. That said that, what this does, okay, in some manner is, okay, when new hospitals come in and so what happens after these two hospitals or three hospitals which have come up? I mean, there isn't a visibility of another hospital coming up in the next five years because if that was coming up, some plans would have already been getting passed, and something would have been built, which is not the situation, right? Now, when that happens, okay, there may be some temporary disruption of costs, right? So your clinician cost at that point in time may go up because, A, you're attracting in that new place in your hospital. Let's say when we put up Gurugram, when we are going to be approaching doctors, bring them you are paying them more than what they're perhaps earning in the peers. If somebody's trying to take your doctors again, they are going to offer something more. So temporarily, for some time, that cost goes up. But that's also a temporary factor, right? Eventually, okay, if there's any cost inflation, okay, it does get passed off to the customer. And that's what we've seen historically. I mean, it's not the first time that you're seeing all of this capacity come up. I mean, if you look at the numbers now, we are building another 400 beds are coming up in Saket, which is the center of the city. Now, it's very different from Gurugram. Gurugram typically doesn't affect outreach, but Gurugram will affect other hospitals in Gurugram. I mean, normally, it would have affected my small hospital in Gurugram, but I'm coming up with a big hospital in Gurugram, right? I mean, if there were hospitals coming up in Mumbai, they'll affect the hospital. But a brownfield will always be the risk. Shaleen what you were asking earlier, right, from our own, our plan is to at each site, right? So capacity that you created in Mohali, occupied, Nanavati, occupied. Gurugram also covers the entire Haryana, Rajasthan directionally comes here. So there's significantly, very, very large pool of demand that gets absorbed by Gurugram. Hello? Hello? We have lost the line of the participant. We'll take the next. It is from the line of Karan Vora with Goldman Sachs. Please go ahead. Yeah. Thank you for taking my question. The first question is with respect to insurance. So I just wanted to get a sense, what would be the rough share of, say, top five insurers for us as a percentage of hospitals' revenue? And when we set up a new hospital, two ways. One is a greenfield, and the other one is when we do a new tower in the existing setup, how easy or difficult is the empanelment? So do we get the same rates as our other hospital in the same city, or we have to negotiate from scratch? How does that work? So that's my first question. So on a brownfield, you don't need to negotiate because the same hospital license just sort of continues into the new so in case of brownfield, there's no rediscussion or re-empanelment. What is happening continues. In case of a new hospital, that means a new hospital license, right? If you don't have the empanelment terms already agreed, then you need to empanel. That means you will make those applications for a hospital. That's for a new hospital. Okay. Got it. And so even sorry. Go ahead. Yeah. Yeah. Go Go on. Basically, most of the insurance companies, we have agreed a category of the hospital. It's Cat 1, Cat 2, Cat 3, Cat 4, right? So whenever a new hospital comes up, the discussion is always, which category will it fall in, right? So for example, Dwarka now is in Cat 2. Saket is Cat 1, right? So it's basically that discussion. Then the rates automatically apply. It's not that we have to get into a negotiation for each hospital separately, right? So you have a set of rates, and obviously, we agree, let's say, for Cat 1. We know Cat 1 to Cat 2 difference is so much. Cat 2 to Cat 3 is different so much. So that's how the tariff gets driven to the insurance companies. So typically, it's not that we have to get into a discussion for each hospital. The discussion is, which Cat will it fall in? The top four to five insurance companies would contribute about 24%-25% of the group revenue of the insurance companies. Got it. Okay. Got it. And just one clarification here. So when you say we have categories determined, so how long does it take? So when, say, for example, Gurugram, whenever it comes online in the next 1 or 2 quarters, what is the expectation of the full empanelment across insurers? Does it take 3 months, 6 months, 12 months? Any rough sense there? I would say within six months. Okay. Got it. Got it. My second question is with respect to you mentioned. Yeah. Yeah. Because typically, you require NABH, right? Okay. Yeah. You require NABH, and to get NABH, you typically require six months of data. Okay. Okay. Okay. Even your institutional patients, okay, take about six months to onboard. And you have different rates for NABH and non-NABH. So I think the first gating item for a new hospital would be to get NABH. Also, concurrently, various licenses in a greenfield, you need such as transplant licenses, this, that, etc., etc. So it's not as if on a brownfield, all existing licenses continue. In a greenfield, you need to apply for each one of those: blood bank license, this license, that license. It's sort of so you can't just start doing liver transplant or kidney transplant or whatever else it is. So your full range of services doesn't start. Got it. So basically, broadly, six to nine months is where you can get the NABH accreditation as well as the insurance empanelment. That's the rough sense we should have. That's right. But I mean, it depends now hospital to hospital. Now, of course, this was the same in Dwarka as well for us. But you're aware, we started Dwarka last July, right? By now, you're already fully occupied on the 300 beds. A way before now, you were fully occupied on the 300 beds. And you're already planning a brownfield on another 200. And we had a break-even within six months over there. Yeah. Sure. Right? Although because it was cash patients, etc. So it's about how you also sequence it, right? So I think the very important art over here is how do you preserve cash flow, and how do you sequence your event? Now, I could have started all 300 beds or 250 beds over there and so on and so forth. You have to forecast the number of beds. You have to plan accordingly, and you have to staff accordingly. If you're going to staff all the beds, all this thing, etc., then you're going to lose money. Now, be it with a brownfield or a greenfield or whatever. So I think that is somewhere you need to be a little more tactful about it. Got it. Got it. Got it. I mean, our total loss for Dwarka in six months till break-even was what? INR 30 crore. INR 30 crore. Up to break-even, the total loss was INR 30 crore. In a brand new market, in a greenfield, in a micro-market where we don't have presence. Got it. My second question is with respect to I think, Abhay, you mentioned in the opening commentary that we should be back with respect to growth from Q4 onwards. I just wanted to get a sense. Do we foresee a stepped or phased manner of recovery in growth that Q4, you might be partially back, and Q1, you should be fully back? Or from Q4, it's a complete clean quarter, and there should be no one-offs or no deterrents from Q4 itself? I think the big deterrent on our growth has been capacity. I mean, essentially, if I go beyond the seasonality of it and whatever one-time disruptions, which are back to normal and so on, I mean, everything that we've acquired over the last this thing or the new capacity that we set up have been ramping up very well. I mean, not ramping, there's been great growth over there. I mean, two years back, the issue was, where is growth going to come from? Because already, I mean, the fact is you're operating a very high capacity, and the growth was going to be coming in essentially from your capacity addition. Got it. And last. There has been that delay, right, of a quarter or two or whatever. Yeah. Yeah. Yeah. Yeah. Yeah. So now that it's online, then you should be back to trajectory. Yeah. The last question is with respect to Gurugram, sorry, if I missed in the opening remarks. Do we expect it to commission by Q4 end or Q1? And what would be the impact, maybe a quarter or two's impact of losses from Gurugram since it's a large greenfield? Any color there will be helpful. Thank you. I think this thing, H1, I think towards the end of H1 is when you should be able to sort of commission that, the first phase over there. And I mean, I'm not going to give you guidance on the losses, but I mean, you have a history in front of you. So you've seen what this thing has been, the recent history, and so on and so forth. And I'll tell you why I'm not doing that, right? I mean, because it is a function it is a function of the clinicians you're able to get and what sort of this thing you're able to start. I'm happy to make a bigger loss over a shorter period of time and to have a deeper trough. What that essentially means is that I've been able to get the clinicians also, day one, in a greenfield. Got it. Thanks. That's helpful. Thank you. Next question comes from the line of Vivek Agarwal with Citi group. Please go ahead. Yeah. Thanks for the opportunity. So one question on CGHS, ECHS rates revision. So you earlier talked about approximately INR 200 crore kind of a positive impact on revenues, but that is including the impact of discontinuation of some patented drugs, etc., right? So is it possible for you to split it? What is the absolute impact of rate revision, and how much of that is likely to be netted from the discontinuation of patented drugs, etc.? Thank you. Give me a guidance. Vivek, we already said that net is INR 200 crore, right? So obviously, there is this netted of the onco part because onco is part of that MOU when the price got revised. So I would say it'll be probably 280 minus 80 type, right? But I must also mention to you that this whole of pricing hasn't happened in quarter three. ECHS has revised their prices only in December. Some of the PSU are asking for new budgets, etc., to increase their prices with the CGHS levels. And also, the super specialty rates within that category will be available from 1st April, right? So to my mind, the full impact of this will start to come from quarter one of next year, but I think a large part will start to flow from quarter four. GST. I understand. Also, I must mention that I also must mention that there is a negative impact of GST both on the revenue side and the margin side, right? So I think if I net that out, then you have to net out another INR 60 crore out of that INR 200 crore number. So it'll be a INR 140 crore number on a sustained positive impact basis in the margin. Understood. So actually, is it right to understand, right? The impact of the discontinuation of patented drugs, etc., or the negative impact as well as including the GST, etc.? So that is largely in this particular quarter. Basically, the GST plus discontinuation of patented drugs is this in the quarter. And the positive impact, let's say, around INR 280 crore only on the rates revision, that is likely to come from Q4. No. No. No. No. No. The INR 200 crore is a sustained impact of the CGHS prices. So the onco pack will continue because under their MOU, they are saying you'll have to give discounts on the chemotherapy drugs by 30%, right? So you only discontinue some of the drugs where the margin was less than 30%. Where the margin was more than 30%, we still continue to supply, but still at a lower revenue, right? So there's a two main impact of the CGHS price increase of the onco drugs. One is that we discontinue some drugs. Some, we are giving 30% discount. So both impacts will be, as I said, INR 80 crore. So INR 280 crore minus INR 80 crore. So this INR 80 crore is sustained impact, right? So that means net is INR 200 crore, and then you have to reduce out of that the GST impact. 140 is the net impact if you ask me on this thing. Yeah. It's not one-time. I'm saying sustained impact. That means you will have both going forward. Understood. Thanks. This is helpful. Just one more question again on insurance, right? It looks like that it has been targeted towards Max while we aren't seeing this kind of impact for some of your other peers, etc., intelligence. Yeah. So any specific reason for this, basically, why it has been targeted towards Max? And separately, what kind of a safeguard that you have that the other insurance companies, let's say, does not do it again in future? I think hopefully, everybody's learned from it because I don't think the disruption is only for Max. I think the disruption would also be for other insurance companies. There's a reason the other insurance companies did not join in. I think it just sort of made some more media this time. It's been disruptive to patients, right? Patients are also customers of the insurance companies. Therefore, you've seen higher amount of complaints and all the issues and everybody else stepping in. Understood. Last question on institutional patient share, right? It has gone up quite a bit, 36%, right? It's again part of this disruption. Any color, how to look at this number, let's say, one year down the line or two years down the line? Well, I think the important thing is that once you're coming up with capacity, okay, the more capacity you come up with, you will have institutional exactly to what extent is another matter. But the fact of the matter is you're still EBITDA per bed is higher even with the lower rates, right, for these capacity additions that you're doing. And that is what you're kind of demonstrating right now. Understood, sir. Thanks. That's all my side. Thank you. Next question comes from the line of Bansi Desai with JP Morgan. Please go ahead. Yeah. Thanks for taking my question. So my first question is on the growth of our existing hospital beds. So traditionally, if we see barring any seasonality impact, we still manage to see good low-teens kind of growth for our existing beds despite the fact that they've been operating at 75%-plus occupancy levels. And partially, it could be because of higher oncology share or robotics, etc., which you mentioned. But as we go forward, do you think theoretically, this has to normalize at some point in time? And for us, therefore, what could be the levers which can keep the growth momentum high over the next two, three years? Well, look, I think seasonality, if you look at the past 10 years, has been a reality, right? I mean, it's not and it has the big difference is last year, okay, you had big seasonality, and this year, you had actually no seasonality. So it's a little bit of a double whammy. So I mean, if you look at the numbers last year, I think you had some 30%-35% growth as a group year-on-year basis, right, in quarter three. So it was a very high sort of this thing. A lot of it was also due to a little higher part on the seasonality, and whereas this time, it's lower. Now, having said that, the big jump in the current year was going to be coming through capacity addition, right? And clearly, there has been a quarter to two delay as far as that is concerned. That is something which would have contributed to increase in revenue. I think as in when you sort of start getting that on stream, you're going to have that. Yeah. So actually, I was just trying to say that if I actually look at this quarter and if I map it over a two-year CAGR, this number still suggests a 20% CAGR over two years. So if I remove that seasonality impact, and this is despite the fact that we have not added as many beds. So what I was trying to understand is that it does mean that our existing beds are still growing well in that low-teens rate. And we've seen that with peers that most mature beds beyond a point, once you've reached your optimal occupancy levels, will probably come down to high single-digit kind of growth rates, etc. So I was just trying to understand that from our side, if seasonality were to remain favorable, then do we continue to see the kind of growth that we've seen? I think, look, two aspects to it. Okay, one is I'm not looking at peaks and troughs as far as seasonality is concerned. I'm just looking at, okay, on a static basis, if you were to put a straight line through it, what the mean is, right? So I'm not looking at extensive seasonality or it happening or not happening. So that's one. I think, secondly, in terms of existing beds are concerned, we've always sort of guided that there are levers, right? I mean, some of those levers get obfuscated because we are opening new beds. But the fact of the matter is there is higher institutional business, okay, which kind of gets or will be getting distilled through it. But it gets obfuscated by the fact that you're opening new beds so that again, so there are levers even in the current capacity. It's not as if they aren't. I mean, it depends how you look at it, how you bifurcate this. I don't know if I'm relating to what you're saying or not. I think also, as management, our job is to make sure that even the existing hospitals grow, right? So they can grow, one, on the ARPOB side, the case mix, etc., and the other is also adding more beds in these hospitals, right? So that's what we're doing. We're trying to do brownfield expansion where in the same campus, when you add more beds, then the existing hospital also grows, right? So there's no existing bed versus new; it's one hospital that we're trying to grow, right? For example, wherever we have higher occupancies, we try to get brownfield beds there. For example, we have an existing hospital now, Dwarka, is an existing hospital, right? So we're adding 260 beds there. So that will make the existing hospital grow. But it doesn't mean that in Dwarka, okay, while they're putting the additional beds over there, okay, your current mix, okay, is more sort of attuned to because you almost got 50% institutional patients over there. And in the first year, you're going to ramp up capacity. You're going to take all sorts of business. And as you go along, okay, you're going to see that distilling. Okay. And my second question is more clarificatory in nature. We mentioned that the GST rate has also had a bearing on our margins. So just wanting to understand, this would have not impacted our absolute EBITDA, right? It would have just impacted our margins because your realizations go down. No, no. In fact, I'll show you EBITDA. It does because when you bill to the patients, they will bill you their MRP. You don't pay the GST on the margin because these goods are used for delivery of medical services, right? So there is an impact on that. So that's how Yogesh led to INR 200 crore net of this thing and then minus another INR 60 crore for this thing. You come into about INR 140 crore as a result of this entire CGHS revision as well as GST. Okay. Because I would assume that GST, our realization, our EBITDA would have been net of that tax amount, right? No, I think probably we'll have to get online separately. I'll make you see why this impacts margins. Okay. Okay. Got it. Thank you. Thank you. Next question comes from the line of Tushar Manudhane, Motilal Oswal Financial Services Limited, please go ahead. Yeah. Thanks for the opportunity. Sir, first clarification, the top 4, 5 insurance companies form 25% of the insurance business, right? Yes. Yes. So secondly, we've been doing roughly INR 400 crore, INR 420 crore plus minus sort of a CapEx per quarter, but FY26, I guess the target is up to INR 1,900. So are we on track to do that kind of CapEx? Yeah. Okay. So effectively, there is a higher CapEx. You know what typically happens, a lot of the CapEx is back-ended. You don't necessarily relate work done to CapEx. I don't think it works in tandem. Necessarily. Also, when you will do a cash flow projection, you will always do a conservative projection, right? That's how we plan for it because you don't want the project to suffer because of financial closure, etc. So this will always be. You'll always find that we'll be spending less than what we're projecting because of the fact that we project a conservative number. Okay. Even if I take roughly INR 400-INR 450 crore per quarter sort of a CapEx, subsequently for FY 2027 also, it will be higher CapEx, right? I'm not referring to bed addition and not even connecting that to bed addition. I'm just referring to the amount that would be spent for the new hospitals effectively. Yeah. I think you have the number already in the slide. We will revisit the number at the end of March in any case, and then probably we'll float the new numbers. But as of now, it's. They are fairly conservative numbers. I mean, you would certainly not be doing more than that. Given the current sort of cash flow, which is roughly INR 300 crore ± cash flow from operations I'm referring to, so does it mean that we'll still have some more debt coming on balance sheet? No. In terms of the incremental beds that we get in on stream now, they will start to reverse operating margins. And then we mentioned that all these beds are EBITDA-accretive less margin equity. So you obviously expect better cash flow from these operations now that the new beds that operationalized. Which means effectively, INR 2,100 crore net debt is the number in FY27 as well. I mean, is that the safe assumption? No. I think the last thing was also this question was asked, it'll go up by around INR 500-INR 600 in terms of net debt, but it'll be still less than one unless we do any M&A, etc. Got it. And just lastly, Smart, there has been almost five-six months delay, and still the regulatory approval is to come through. So February 26 is that sort of now largely certain, or that might get pushed further? So as far as Max Smart is concerned, the original time given was FY 2028. This project has taken us about 24-25 months in its entirety. We expect approvals by end of February. It's just got ready now, and we've just applied for approvals. So there will be no delay in approvals. I want to put that also in place. So it's not as if the project has been lying ready and sort of approvals is what is delaying. Okay, I think the project has been delivered now, and approvals have been sort of this thing. We're expecting it by end of February. In fact, whatever attendant approvals are, they've been coming through very, very quickly and very smoothly. Got it, sir. Thanks. Thanks for that explanation. Actually, in this one, we've been sort of, like I said, ahead of schedule. This one and Zirakpur, we have seemed to be ahead of schedule. Thank you. The last question comes from the line of Nitin Agarwal with DAM Capital. Please go ahead. Hi, sir. Thanks for taking my question. Abhay, you've talked a couple of times about the Dwarka Hospital and the fact that we've seen encouraging progress on it to go in for expansion. If you can just give us some color on what's been the financial progress for the hospital in terms of where it's reached right now, which prompted you to go for expansion at this early stage? I think we're already operating in close to 80% capacity, 75% capacity, although almost half of the business continues to be institutional. Like I said, early the life cycle of a sort of hospital, you'd first ramp up occupancy, okay? And you'd ramp up occupancy with all sorts of business, then you start distilling it. So we're already doing 20%+, 20%-22% margins over there. 20%? 20%. 20% margins at Dwarka, okay? While 50% of the business is institutional, when we put up capacity now going forward, it'll take us at least two years to put up that capacity. That means in the better part of two years, I will not have beds easy to survive from 75%. We'll probably go to 85%. So I will be distilling my beds. That means we already see month-on-month there's more and more cash and insurance patients coming through, and the institutional patients are reducing. And therefore, you'll see the margins move up, right? So that's the encouraging part. Got it. Got it. Got it. And secondly, on the Jaypee Hospital, if you can give us any update on the progress on that? So Jaypee Hospital is doing well now. I think the occupancy has improved over the period in the hospital. So are you looking for some specific number for that? I'm just curious in terms of from where you acquired to where it's come to, what's the distance we've covered in terms of performance improvement in that business? So I think if I take Y- on- Y, it'll be more than 30% growth, right? We took this in last same quarter last year. So the revenues are up by 30%-35% range. EBITDA is also up similarly. Obviously, I'm not giving you the specific numbers in terms of revenue, etc., but I think that's the state it is. And when I say 30% increase in revenue, that obviously means that the revenue has come down first because when we acquired the hospital, we stopped all those referrals, etc. The revenue tanked a bit, and then we brought it back. So this 30% growth Y- on- Y, same quarter, is basically after that dip which happened in the first quarter after acquisition, and then we built it up. So the real growth would actually be around 40%. In terms of profitability, is it now closer to your network profitability? How far is it from there? No, it is not. It's less. So I think the first endeavor was to stabilize the operations. We had a lot of complaints in that hospital, right? So we were watching on that. I think the margin is probably 3%-4% lower than the overall margin that we have in the network. Secondly, when we look at our business for the next couple of years, the EBITDA per bed for us has been a pretty dramatic journey which we've had over the years. Around INR 7.5 million-INR 8 million is where we are at. I mean, does the network EBITDA stabilize around that, or do you see opportunities for us to significantly increment it from these levels? And how should we think about EBITDA per bed? So So when you take a two three -year view from here. Yeah, Max. EBITDA per bed? No, so we don't go to a direction for chasing EBITDA per bed also as a base, right? So our trajectory is to deploy capital efficiently to have yields on the capital. That may be an outcome of EBITDA. In some places, we have a lower EBITDA per bed, so you have to focus on ROC over there, right? I mean, we're not focusing on making EBITDA per bed or ARPOB accretive or whatever. We are focusing on ROC. Got it. And if I can take the last one on that, Abhay, over the next two years, where do we see our operational beds sort of hitting out? We are about 46% into operational beds right now. Where do we end up in the next two years? I think higher than 400. 4,800. Yeah, 4,800. I think now you're adding another close to 1,000 beds now and another 1,500 including Gurgaon. So that's 6,500, and by 2028, you should be hitting what? 8,000. 8,000? 8,500? Yeah, roughly. I think it's on the one you just added up. It's in the presentation. About 8,500 is where it should be? I just looked at the presentation. I love the exact listing, huh? By 2028, 2027, 2026, 2029, somewhere across there. Presentation maybe, I think it's on the. Okay. Thank you. Thank you so much. So location-wise, it's there, no? Location-wise, how many beds? How many are brownfield? How many are greenfield? How many are green? Yeah. With respect to the delays and all that you foresee, by the time we finish FY28, you still brought more or less in the same ballpark that we had in the presentation is what I meant. That's right. So I mean, we've given it out in the presentation, updated numbers. This current quarter, this thing will be updated for any delays. Okay. Perfect. Okay. Thank you so much. Thank you. Ladies and gentlemen, we have reached the end of question-and-answer session. I would now like to hand the conference over to the management for closing comments. Thank you, everyone, for joining us today. We appreciate all your time and look forward to interacting with you again next quarter. Thank you very much. Thank you on behalf of Max Healthcare Institute Limited. That concludes this conference. Thank you for joining us. You may now disconnect your lines.