Why Sagility India Share Price is Rising

India's healthcare sector is a rapidly growing industry, driven by increasing demand for quality services and innovative solutions. The country's population growth, demographics, and rising health awareness are fuelling this expansion.

Additionally, India has emerged as a global hub for pharmaceutical and healthcare exports. Its competitive pricing and manufacturing capabilities make it a preferred choice for many countries.

One notable player in India's healthcare sector is Sagility India. The company specialises in providing business process management (BPM) services for the healthcare industry. It works with clients globally to streamline operations, enhance efficiency, and deliver better patient outcomes.

Sagility focuses on leveraging technology and data to support healthcare providers and payers in navigating complex systems and regulations.

It was listed recently on 12 November 2024, at a listing price 2.3% below its issue price of Rs 30 per share. The company is recently under investor focus due to a sharp rally in its share price.

Over the past five days, the stock surged by 21.7% following the announcement of its quarterly results. This remarkable growth highlights strong investor confidence and interest in the company's performance.

Let's examine Sagility India's quarterly results to understand the factors behind this upward momentum in its share price.

Good Quarterly Results

Sagility India reported a remarkable 236% year-on-year (YoY) growth in profit after tax (PAT) for Q2FY25. PAT rose to Rs 1.2 bn (bn) from Rs 0.3 bn in the same quarter last year. This increase was driven by improved operational efficiency and higher profitability from key business segments.

Revenue grew by 21% YoY, reaching Rs 13.3 bn compared to Rs 10.9 bn in Q2FY24. The rise in revenue reflects strong demand for Sagility's services and successful client acquisition efforts.

The earnings before interest, taxes, depreciation, and amortisation (EBITDA) also witnessed a 20.3% YoY growth, climbing to Rs 3.2 bn. However, the EBITDA margin declined slightly to 23.9% from 24.1% a year ago.

Sagility's client base remained strong, with 45 active clients as of 30 September 2024. The company also broadened its global reach, operating in five countries with 32 delivery centres, which underscores its commitment to scaling operations and meeting international demand.

The sharp rise in Sagility India's share price can be attributed to the impressive growth in key financial metrics which exceeded market expectations.

What Next?

The company plans to deepen investments in advanced technologies, particularly AI and machine learning, to enhance service offerings and improve client outcomes.

By focusing on innovation, Sagility aims to deliver solutions that align with the evolving demands of the healthcare industry.

Geographic expansion remains a priority, with plans to broaden its presence in existing markets while exploring opportunities in new regions. Strengthening its global delivery network will be critical to scaling operations and supporting a diverse client base.

The company also aims to build on its strong client relationships by offering more tailored and value-driven services, ensuring sustained client retention and satisfaction.

Operational efficiency will continue to be a key focus area, with efforts to optimise processes and reduce costs. These measures are expected to improve profitability and maintain healthy margins despite rising investment in technology and infrastructure.

Sagility's long-term strategy includes capitalising on favourable industry dynamics in the US healthcare sector, its largest market. The company aims to strengthen its position as a trusted partner for payers and providers by delivering measurable business outcomes.

How Sagility India Share Price has Performed Recently

In the past five days, Sagility India share price has rallied 21.4%. Despite the weak listing, its share price has rallied 18.3% since listing.

The stock touched its 52-week high of Rs 36.2 on 28 November 2024 and a 52-week low of Rs 27 on 13 November 2024.

About Sagility India

Sagility India formerly known as Berkmeer India combines technology and transformation-driven business process management (BPM) services with decades of healthcare domain expertise to help clients draw closer to their members.

The company optimises the entire member/patient experience through service offerings for clinical, case management, member engagement, provider solutions, payment integrity, claims cost containment, and analytics. Sagility has more than 25,000 employees across 5 countries.

It supports the core business of both payers and providers. Services to payers span their entire operational spectrum, including centralized claims administration and clinical services functions. These include claims administration, payment integrity, clinical management, and other services.

For providers, the company offers revenue cycle management services to assist them in managing their billing and claiming treatment costs from payers.

In addition, the company also offers some of the services it provides to payers to pharmacy benefit managers (PBMs) who manage prescription drug coverage for members (i.e., insureds) under health benefit plans.

To know more about the company, check out its factsheet and quarterly results.

To know what's moving the Indian stock markets today, check out the most recent share market updates here.

Happy Investing.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...