Fortis Q4 profit jumps as costs trail revenue growth
The gain also reflects a lower tax rate, while operating margin remains below the 23.38% healthcare-peer median.
Filed 22 May 2026, 20:05 IST · after market close · Fortis Healthcare Ltd (FORTIS)
Key takeaways
- Consolidated Q4FY26 net profit rose 44.23% YoY as revenue growth of 17.81% outpaced expense growth of 16.58%.
- The operating margin expanded 0.81 percentage points YoY, but the 16.35% tax rate also supported profit growth after falling 4.17 percentage points.
- The stock initially gained 1.04% after the results, but its five-day return was -3.23% against a 1.77% median absolute move after its past eight results.
Price around the results
Revenue momentum lifted Fortis’s consolidated Q4 profit
Consolidated Q4FY26 revenue grew 17.81% YoY, faster than expenses at 16.58%, allowing operating profit to grow 22.24%. Net profit growth was stronger at 44.23%, helped by the lower tax rate and a favourable sequential comparison. Revenue rose 4.40% QoQ while net profit increased 37.38%, showing a sharper improvement below the operating line.
Margin edged higher, but tax did more of the work for profit
Costs grew more slowly than revenue, widening operating margin by 0.81 percentage points YoY and 0.19 percentage points QoQ. Interest expense still rose 24.75% YoY, partly offsetting the operating gain. The tax rate fell 4.17 percentage points YoY and 9.35 percentage points QoQ, while other income was negative and represented -0.58% of pre-tax profit, so the earnings uplift was not supported by other income.
Margin recovered from Q3 but stayed below the sector median
Operating margin improved from 22.32% in Q3FY26 to 22.51% in Q4FY26, breaking the prior-quarter decline but remaining below the Q2FY26 level of 23.86%. Fortis’s margin was 0.87 percentage points below the 23.38% median for the 48 healthcare peers that had reported the same quarter. The sequence points to a recovery from Q3 rather than a return to the year’s earlier margin peak.
Management linked expansion to equipment and diagnostics additions
Management said Fortis is progressing with brownfield expansion and evaluating inorganic opportunities within its focus geographic clusters. The company said it added five soft-tissue surgical robots, two MRI machines, four Cath labs and one PET CT during FY26, while its diagnostics network reached 4,445 customer touchpoints by March 31, 2026. Management also reported that hospital occupancy declined to 68% in FY26 from 69% in FY25, and that net debt rose to Rs 2,334 cr, with net debt to EBITDA at 1.09x versus 0.93x a year earlier.
The initial market gain was weaker than Fortis’s typical result reaction
The stock rose 1.04% on the first session after the results, with a 0.90% opening gap, but was down 3.23% after five sessions. Over the past eight results, the stock rose after two and fell after six, with a median absolute move of 1.77%. The initial move was smaller than that typical move, while the five-day decline was more pronounced.
Q4FY26 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q4FY26 | Q3FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹2,365 cr | ₹2,265 cr | +4.40% | +17.81% |
| Other income | ₹-2 cr | ₹-34 cr | +94.49% | +93.55% |
| Expenses | ₹1,832 cr | ₹1,759 cr | +4.15% | +16.58% |
| Operating profit | ₹532 cr | ₹506 cr | +5.28% | +22.24% |
| Operating margin (%) | 22.51% | 22.32% | — | — |
| Interest | ₹84 cr | ₹86 cr | -1.70% | +24.75% |
| Depreciation | ₹122 cr | ₹120 cr | +1.52% | +19.31% |
| Profit before tax | ₹324 cr | ₹266 cr | +22.03% | +37.05% |
| Tax | ₹53 cr | ₹68 cr | -22.36% | +9.23% |
| Net profit | ₹271 cr | ₹197 cr | +37.38% | +44.23% |
| EPS (₹) | ₹3.52 | ₹2.57 | +36.96% | +44.26% |
Operating margin of 22.51% compares with a Healthcare sector median of 23.38% across 48 peers that have reported Q4FY26.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | +1.04% | -0.28% |
| Next session | +0.65% | — |
| 5 sessions | -3.23% | -2.23% |
| 15 sessions | +0.91% | — |
| 30 sessions | -1.73% | — |
Volume on the results session was 1.38× its 20-day average.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
Guidance & outlook
- Fortis continues its brownfield expansion plans and is evaluating further inorganic growth opportunities within its focus geographic clusters.
Expansion
- Fortis added five soft tissue surgical robots, two MRI machines, four Cath labs and one PET CT during FY26.
New initiatives
- Fortis expanded its diagnostics network through new customer touchpoints, reaching 4,445 touchpoints by March 31, 2026.
- Fortis improved energy optimisation, carbon emissions, water conservation and plastic waste reduction through ESG initiatives.
Problems & risks
- Hospital occupancy declined to 68% in FY26 from 69% in FY25.
- Net debt increased to INR 2,334 crore and net debt to EBITDA rose to 1.09x as of March 31, 2026.
- FY26 PAT included an exceptional net loss of INR 55.2 crore related to the one-time impact of new Labour Codes.
What to watch
- Whether operating margin holds around 22.51% after the Q4FY26 recovery from 22.32%.
- Whether occupancy improves from 68% as Fortis adds capacity and medical equipment.
- How net debt develops from Rs 2,334 cr and net debt to EBITDA from 1.09x.