Thailand is amazing! The number of medical tourists is growing significantly, and BDMS plans to open a new hospital, expecting profits to rise to $16.3 billion.

Land and Houses Securities Public Company Limited said BDMS or Bangkok Dusit General Medical Services Limited expects Q1 2024 earnings of +15.3% YoY and +1.2% QoQ, both from an increase in the number of foreign patients. The number of Thai patients receiving treatment for the epidemic has increased.

Hospital business income is expected to rise +1.2% q-o-q and +11% y-o-y, with income from Thai patients expected to increase approximately 10.4% y-o-y, mainly from the first two months of this year. There are Thai patients who come to receive treatment for influenza. Respiratory syncytial virus (RSV) infection, which is a virus that causes inflammation of the lower lining of the respiratory tract. – Pneumonia occurs, more than 60% of them are children.

Foreign patient income is expected to grow by up to 13% y/y, with notable growth in foreign patient income including China +30% y/y, Europe +20% y/y, while income for CLMV and East patients has stabilized. Middle Gradually year-on-year For the CLMV group, income for Burmese patients decreased by single digits year-on-year due to political influences in Burma. But this could be offset by Cambodian patients' income increasing at the per-cigarette level on an annual basis as well.

Meanwhile, patient income in the Middle East was stable year-on-year due to the impact of Ramadan, which this year was in March for 22 days, while it was in March last year. Only 9 days

In this regard, patient income in Middle Eastern countries continued to grow by more than 10% on an annual basis, with patients from the United Arab Emirates, 2) Qatar, and 3) Saudi Arabia coming in first place.

As for the income from Middle Eastern patients that decreased the most, it was Kuwait, but since the percentage of income from Kuwaiti patients was 0.7%, it did not have any significant impact. In this regard, earnings performance in the first quarter of 2024 remained similar to the fourth quarter of 2023 but improved from the first quarter of 2023 due to the growth of foreign patients who came to receive treatment for more difficult diseases. As a result, net profit for the 1/24 period is expected to reach 4 billion baht, an increase of 15.3% year-on-year and 1.2% quarter-on-quarter.

As for Q2 2024 earnings, there is a tendency to weaken in the quarter due to the impact of the long Songkran holiday period. But it is believed that it will still grow by more than 10% year on year. Middle East patient income is expected to return to growing well year-on-year in the second quarter of 2024 because the Ramadan period last year was in April for 22 days. While in April this year, there are only 9 days left, until April 9, 2024, in addition to marketing in new countries such as. Arabian Tea, which has a representative office in the aforementioned country, and it is expected that more Middle Eastern residents will travel for treatment.

However, the third to fourth quarter of 2024 enters the peak season, which is the end of the rainy season and the beginning of winter. Which led to a large number of Thais coming to receive treatment for the epidemic, and the third quarter of 2024 is the summer vacation period for Middle Eastern countries. Which patients like to come for treatment along with bringing family to travel and the fourth quarter of 2024 is the Thai tourism season, causing a large number of medical tourists. As a result, this year's profits are expected to reach 16.3 billion baht, an increase of 14 % over the previous year. It is expected to grow by another 12% next year

Through BDMS, revenue in 2024-2026 will grow by an average of 10% per year, and EBITDA margin will rise to 25% in 2026, with Thai patient population continuing to grow in line with the growing number of elderly Thais and increasing overall capacity. To modern tools for treating difficult diseases in 14 hospitals are Centers of Excellence (COE), increasing the number of people insured under the Social Security Program from 800,000 currently to 1 million by 2026, including increasing the number of foreign patients, while continuing to focus on Middle Eastern patients, CLMV patients, patients from China and mainly from European countries

Using the strengths of 14 Hospital Centers of Excellence distributed in Thai tourist attractions across the country. There is also a plan to expand the number of inpatient beds to more than 9.3 thousand beds in 2026 from the current 8.6 thousand beds, by increasing the number of current hospital beds. And the opening of new hospitals. With these results, profits in 2026 are expected to remain inclined to at least 10%, and are likely to continue growing in the long term.

However, it is recommended that BDMS shares have a fundamental value this year based on the DCF method of 36 baht, with an appreciation of 26.3%, as well as a continued good growth trend over the next three years, providing an opportunity to buy and invest. .