See Bull Run's company pages for Apollo Hospitals Enterprise and Max Healthcare Institute.

Q1 FY27 scorecard: first separate hospital economics from consolidated economics

The most important methodological point: Apollo no longer reports ARPOB

This was a deliberate management decision.

Apollo argued that ARPOB combines several separate hospital variables into one number:

• tariff or price;
• case mix;
• average length of stay;
• occupancy;
• bed turnover.

A rising ARPOB does not necessarily mean patients are being charged more.

It can rise simply because the hospital treats more complex cases or turns beds faster.

Why Apollo switched to ARPP

Management believes average revenue per patient better isolates the economic realization from each inpatient episode.

Apollo's Q1 FY27 ARPP was approximately ₹186,630.

That represented growth of around 8.3% year on year.

Average length of stay was approximately 3.09 days.

Inpatient volumes increased about 13%.

Do not divide ARPP by length of stay and call the result Apollo ARPOB

A derived number might look mathematically clean while being operationally false.

For an investor, that is worse than leaving the field blank.

Max still reports ARPOB—and it increased 5%

Max Q1 ARPOB reached approximately ₹81,900.

That compared with:

• ₹78,000 in Q1 FY26;
• ₹77,900 in Q4 FY26.

Growth therefore came from both patient utilisation and realization.

Max's Occupied Bed Days increased approximately 10% year on year.

Max's 75% occupancy is a significant strength

Hospital occupancy is one of the most important determinants of fixed-asset economics.

A hospital requires:

• doctors;
• nurses;
• equipment;
• utilities;
• maintenance;
• administrative staff;
• depreciation;

whether 50% or 80% of beds are occupied.

Higher utilisation therefore spreads fixed costs across more patient days.

But maximum occupancy is not automatically optimal

A hospital operating perpetually near 100% occupancy can suffer:

• emergency-admission constraints;
• longer waiting times;
• staffing stress;
• reduced flexibility for high-acuity cases.

Hospital operators generally need some available capacity.

The economically attractive zone depends on specialty mix and local demand.

Apollo's occupancy improved five percentage points

Group occupancy increased from approximately 65% in Q1 FY26 to 70% in Q1 FY27.

That is a meaningful operational improvement.

Established hospitals operated at a somewhat higher occupancy than the overall group because newly commissioned facilities reduce the blended number during ramp-up.

This is why new hospitals initially dilute occupancy

When a 200-bed hospital opens, it does not immediately have 150 occupied beds.

Physician recruitment, referral development, payer empanelment and patient trust take time.

The facility carries most fixed costs from day one.

New capacity can therefore reduce:

• occupancy;
• EBITDA margin;
• ROCE;
• EBITDA per bed.

before becoming economically attractive.

Apollo has roughly 55% more reported operating beds

Apollo reported approximately 8,352 operating beds under its Q1 company definition.

Max reported 5,379 operational beds.

Apollo's base is therefore about 1.55 times Max's.

This gives Apollo enormous absolute operating scale.

But Apollo's broader network is even larger than that figure suggests

The 8,352 figure excludes some managed and other beds under Apollo's reporting definition.

Apollo's broader healthcare network is often described at approximately 10,000 beds.

For this article, Bull Run uses the narrower company-reported operating-bed number when discussing occupancy because it is closer to the actual Q1 operating KPI.

Max added 630 operational beds in one year

Max operational capacity increased to 5,379 beds from approximately 4,749 a year earlier.

That represents around 13% capacity growth.

Maintaining 75% occupancy while expanding capacity is particularly important.

It suggests demand growth is keeping pace with bed additions.

Max's growth therefore came more from volume than pure pricing

Occupied Bed Days increased 10%.

ARPOB increased 5%.

Network gross revenue increased 16%.

This is a healthy combination.

Revenue growth was not dependent solely on increasing realization per occupied bed.

Apollo Healthcare Services grew even faster

Apollo's core Healthcare Services revenue increased approximately 22% to ₹3,567 crore.

Healthcare Services EBITDA increased about 20% to ₹862 crore.

The growth reflected:

• higher inpatient volumes;
• better occupancy;
• specialty-case growth;
• new hospitals;
• higher ARPP.

Complex specialties are driving Apollo's economics

Apollo continues to focus heavily on:

• cardiology;
• oncology;
• neurosciences;
• gastroenterology;
• orthopaedics.

Complex surgical and medical cases can raise revenue per patient while also requiring expensive equipment and specialist talent.

This is why revenue realization must be interpreted alongside case mix.

Hospital operating margins are surprisingly close

Apollo Healthcare Services generated approximately ₹862 crore of EBITDA on ₹3,567 crore of revenue.

That implies a margin around 24.2%.

Max reported network operating EBITDA margin of 24.8%.

The difference is only around 60 basis points.

Max therefore wins current percentage hospital margins—narrowly

Max's higher occupancy supports fixed-cost absorption.

Its premium metro and tertiary-care mix also supports ARPOB.

But the margin lead is small enough that investors should not treat it as a structural gulf.

Apollo generates more absolute hospital EBITDA because it operates at much larger scale.

The margin definitions are not perfectly identical

Max's network reporting includes hospitals beyond the narrow listed-company statutory perimeter through network accounting conventions.

Apollo's Healthcare Services is a reported business segment within a larger integrated healthcare group.

Max's network revenue is not its statutory consolidated revenue

Max reported network gross revenue of approximately ₹2,982 crore.

Network net revenue was approximately ₹2,835 crore.

Statutory consolidated revenue from operations was approximately ₹2,366 crore.

These are different reporting scopes.

That distinction matters for valuation

A stock-market P/E is calculated from statutory consolidated earnings.

Hospital operating KPIs such as ARPOB and network EBITDA may use the broader network definition.

Mixing network revenue with statutory profit creates misleading margins.

Bull Run therefore labels every Max metric by reporting scope.

Apollo's consolidated revenue is also not pure hospital revenue

Apollo generated approximately ₹7,043 crore of consolidated Q1 revenue.

That includes far more than hospitals.

Apollo also owns significant businesses across:

• offline pharmacy distribution;
• Apollo 24/7 digital healthcare;
• diagnostics;
• primary care;
• specialty clinics;
• other healthcare services.

Comparing ₹7,043 crore directly with Max's ₹2,982 crore and calling it a hospital-revenue comparison would therefore be incorrect.

Apollo HealthCo creates an important diversification advantage

Apollo's pharmacy and digital platform gives the company exposure to patients outside hospital admissions.

The ecosystem can capture healthcare spending through:

• medicines;
• digital consultations;
• diagnostics;
• chronic-care engagement;
• hospital referrals.

That creates potential cross-selling and patient-retention advantages.

But the integrated model also makes Apollo harder to value

Apollo is not a pure hospital stock.

Its consolidated P/E includes businesses with different margins, growth rates and capital requirements.

Max is much closer to a premium hospital-led investment thesis.

This makes Max easier to analyse on hospital unit economics.

Max's international patient business is growing

International patient revenue reached approximately ₹247 crore in Q1.

It increased around 18% year on year.

International patients can be attractive because complex tertiary procedures often carry high revenue per case.

However, geopolitical and visa disruptions can create volatility.

Max also has smaller adjacent businesses

Max Lab gross revenue increased approximately 20% to ₹58 crore.

Max@Home increased approximately 32% to ₹78 crore.

These businesses remain small compared with hospitals.

They can nevertheless improve patient engagement and referral economics over time.

Apollo's expansion programme is enormous

This can create a much larger hospital earnings base.

It also creates major execution risk.

New hospitals must be:

• built on budget;
• staffed with high-quality doctors;
• commissioned on schedule;
• filled with patients;
• ramped to acceptable margins.

Apollo already opened several new facilities

Recent commissioning includes facilities across markets such as:

• Hyderabad Financial District;
• Sonarpur;
• Pune;
• Delhi oncology;
• Sarjapur, Bengaluru.

The Sarjapur facility added approximately 180 beds during Q1 FY27.

New Apollo hospitals are currently a margin drag

Recently commissioned facilities together generated an EBITDA loss of approximately ₹38 crore during Q1 under management commentary.

This is not necessarily a negative long-term signal.

It is normal for new hospitals to lose money during ramp-up.

The question is how quickly they reach:

• 50% occupancy;
• 60% occupancy;
• mature-case mix;
• positive EBITDA;
• target ROCE.

Max is also in a major expansion cycle

Max's operational capacity has already risen sharply.

Its longer-term pipeline includes:

• Gurugram;
• Lucknow expansion;
• Bhubaneswar;
• Pune;
• Vaishali;
• Zirakpur/Mohali;
• Nagpur;
• additional brownfield projects.

Its stated long-term network capacity ambition moves toward roughly 10,000 beds by FY30 under current plans.

Max acquired Kalinga Hospital in Bhubaneswar

Max completed the acquisition of a 58.28% controlling stake in Kalinga Hospital in May 2026.

The hospital has approximately 250 beds.

It was renamed Max Super Specialty Hospital, Bhubaneswar.

This gives Max a direct presence in Odisha.

Kalinga demonstrates why acquired beds do not immediately equal premium economics

Post-acquisition Q1 contribution was approximately:

• ₹19 crore revenue;
• around ₹2 crore EBITDA;
• roughly 50% occupancy;
• ARPOB around ₹35,000 under company disclosure.

That is far below the Max network ARPOB of ₹81,900.

There is therefore significant upside if Max can improve clinical mix and occupancy.

It also creates near-term margin dilution

A lower-occupancy hospital with weaker ARPOB dilutes network averages during integration.

This is exactly the same economic problem Apollo faces with greenfield hospitals.

Growth requires accepting temporary dilution.

Max's Pune project adds another 450-bed opportunity

Max acquired its interest in Yerawada Properties and received preliminary municipal approval for a proposed approximately 450-bed hospital in Pune.

Pune is a large healthcare market with attractive private-hospital demand.

The facility nevertheless requires substantial construction and ramp-up before contributing mature earnings.

Vaishali will add another 202 beds

Max approved approximately ₹425 crore of capex for a brownfield tower at its Vaishali hospital.

The project would add around 202 beds to the existing 387-bed capacity.

Brownfield expansion can be economically attractive because an existing hospital already has:

• brand recognition;
• doctor networks;
• referral relationships;
• support infrastructure;
• existing occupancy demand.

This can reduce ramp-up risk versus a completely new greenfield hospital.

EBITDA per bed favours Max's mature premium model

Max reported annualised network EBITDA per bed of approximately ₹71.2 lakh.

That increased from ₹68.5 lakh a year earlier.

The metric fell from ₹73.4 lakh in Q4 because new capacity diluted productivity.

This shows why investors should track mature and new beds separately.

Bed growth does not create value by itself

A hospital chain can double beds and destroy shareholder value if:

• occupancy remains low;
• doctors do not join;
• ARPOB or ARPP disappoints;
• capex per bed is too high;
• debt increases excessively;
• EBITDA margins remain structurally weak.

The key KPI is return on the incremental hospital capital.

This is where Apollo currently has an advantage

Apollo currently earns materially higher standardized ROCE.

That matters because hospitals are capital-intensive assets.

A chain creating more beds at low returns can be less valuable than a smaller chain creating fewer beds at premium returns.

Max's lower ROCE partly reflects the expansion cycle

Max is adding capacity rapidly.

New hospitals and acquired facilities initially sit below mature utilisation.

Capital is already invested while earnings are still ramping.

This temporarily lowers return ratios.

If the new beds mature successfully, ROCE can increase without equivalent additional capital.

Apollo also carries more leverage

Bull Run's standardized debt-to-equity is approximately 0.60x for Apollo versus 0.32x for Max.

Apollo's integrated business structure and expansion plans require significant capital.

Max therefore has the cleaner standardized leverage ratio today.

Free-cash-flow history favours Apollo in absolute terms

Bull Run records approximately ₹3,388 crore of cumulative five-year free cash flow for Apollo versus around ₹2,114 crore for Max.

Apollo is the larger enterprise, so absolute cash flow should naturally be higher.

The more important future question is cash flow after funding thousands of new beds.

Valuation is expensive for both hospital chains

Max trades at the higher earnings multiple.

Apollo trades at the higher book-value multiple.

That tells investors something important about how the market views the businesses.

Apollo's high price-to-book reflects higher current returns

Apollo's ROE is approximately 21.9%.

Max's is around 14.3%.

Investors therefore pay more for each rupee of Apollo equity because the current equity base earns more.

The question is whether Apollo can preserve those returns through a massive expansion cycle.

Max's higher P/E reflects future bed expectations

Max has a large visible expansion pipeline.

The market is willing to pay roughly 74 times trailing earnings because future earnings may be substantially larger if:

• new beds open on schedule;
• occupancy stays around the mid-70s;
• ARPOB grows;
• new hospitals reach mature margins;
• international-patient revenue expands.

That creates a high execution hurdle.

Apollo is cheaper on P/E despite stronger current ROCE

Apollo trades around 61.5x earnings.

That is still a very high absolute multiple.

But relative to Max, Apollo currently offers:

• higher ROCE;
• higher ROE;
• larger hospital scale;
• faster healthcare-services growth;
• lower P/E.

This makes Apollo's valuation surprisingly competitive in the direct comparison.

Max is not cheap merely because its share price has fallen

Max is down approximately 14.4% over one year in Bull Run's latest snapshot.

Apollo is up approximately 13.5%.

Yet Max still trades at the higher P/E.

This shows how highly the market had valued Max before the correction.

Apollo's recent momentum is stronger

Apollo is positive over three months, six months and one year.

Max has delivered weaker six-month and one-year returns.

Momentum should not determine a long-term hospital investment.

But valuation expectations often matter as much as operating quality.

What must Apollo Hospitals prove?

• Occupancy should continue improving without compromising care quality.
• New hospitals need to move from EBITDA losses toward mature margins.
• More than 5,800 planned beds must be added with capital discipline.
• Healthcare Services margin should remain around the mid-20s.
• ARPP growth should come from case mix and legitimate realization rather than unsustainable tariff increases.
• HealthCo and other businesses need continued improvement.
• ROCE should remain strong through the expansion cycle.

What must Max Healthcare prove?

• 75% occupancy should remain sustainable as capacity expands.
• ARPOB growth needs both case-mix and volume support.
• Bhubaneswar needs significant operational improvement.
• Pune, Vaishali and other projects should commission on schedule.
• Network EBITDA margin should recover as new beds mature.
• ROCE must improve toward premium-hospital economics.
• Future earnings need to justify a 70x-plus P/E.

What could make Max outperform Apollo?

Exceptional execution on capacity utilisation.

Max already runs at 75% occupancy.

If it adds thousands of beds while maintaining occupancy and high ARPOB, incremental EBITDA can scale rapidly.

Brownfield projects can be particularly powerful because existing hospitals already have established demand.

What could make Apollo outperform Max?

Preserving high ROCE while scaling an already larger network.

Apollo has greater operating-bed scale, a broader healthcare ecosystem and a lower starting P/E.

If new hospitals reach profitability quickly and HealthCo continues improving, earnings can compound without requiring a higher valuation multiple.

Which hospital chain has higher occupancy?

Max Healthcare.

Q1 network occupancy was approximately 75% versus Apollo group occupancy around 70%.

Which has more operating beds?

Apollo Hospitals.

Apollo reported approximately 8,352 operating beds versus Max at 5,379.

Apollo's company-defined operating-bed base is therefore roughly 55% larger.

Which has higher ARPOB?

This question cannot be answered responsibly because Apollo no longer reports ARPOB.

Max reported ₹81,900 ARPOB.

Apollo reports ARPP of approximately ₹186,630 instead.

ARPP and ARPOB are different KPIs.

Which has higher hospital margins?

Max, narrowly, under the companies' respective operating definitions.

Max network operating EBITDA margin was 24.8% versus Apollo Healthcare Services at approximately 24.2%.

Which has stronger capital efficiency?

Apollo Hospitals.

Bull Run standardized ROCE is approximately 19.3% versus Max Healthcare at 13.4%.

Which has the stronger valuation?

Apollo on current P/E and return ratios.

Apollo trades around 61.5x earnings versus Max around 73.7x while earning higher ROCE and ROE.

Max is cheaper on price-to-book, but currently produces lower returns on that book value.

Which is better: Apollo Hospitals or Max Healthcare?

Apollo Hospitals currently has the stronger valuation-adjusted scale profile. It operates materially more beds, Healthcare Services revenue grew about 22%, group occupancy improved sharply, ROCE is higher and the stock trades at a lower trailing P/E.

Max Healthcare currently has the stronger utilisation profile. Occupancy is approximately 75%, ARPOB increased 5%, occupied bed days grew 10% and network operating margin is slightly above Apollo's hospital-services margin.

Both are entering major expansion cycles.

That means future shareholder returns will depend less on announcing new beds and more on filling them profitably.

At September 2026 valuations, Apollo has the stronger current risk-adjusted setup because it combines greater scale, higher capital returns and a lower P/E. Max can close or reverse that gap if its new hospitals maintain premium occupancy and ARPOB while pushing ROCE upward—but a 73.7x earnings multiple leaves less room for execution mistakes.

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