– Apollo Hospitals Enterprise Announces $300 Million Investment in Apollo HealthCo

Shares of Apollo Hospitals Enterprise took a hit today, dropping over 8 percent in intra-day trading after the announcement of a major fundraising move. The healthcare giant revealed plans to raise approximately $300 million through private equity firm Advent International for its unit Apollo HealthCo, which manages the Apollo 24/7 vertical. Additionally, a merger with Keimed, a wholesale pharma distribution business, is on the horizon over the next 24 to 30 months.

Advent International’s investment will secure a 12.1 percent stake in the combined entity, valuing it at a substantial $3.2 billion. However, concerns arose regarding the valuation of Apollo 24/7, which fell short of expectations, leading to a sharp decline in the stock price.

Despite the valuation worries, analysts believe that the deal could benefit Apollo Hospitals in the long run. Nuvama Institutional Equities highlighted the potential for reduced operating costs and strengthened pharmacy and hospital businesses. Other brokerages like Jefferies and Prabhudas Lilladher also expressed optimism about the merger’s positive impact.

While the stock took a hit following the announcement, analysts maintain a positive outlook on Apollo Hospitals, citing growth potential and future financial performance. Motilal Oswal Financial Services even anticipates a significant earnings growth rate for the merged entity over the next few years.

Investors are advised to consult with experts before making any investment decisions, as individual analysts’ views may vary.