KGI Securities (Thailand) (KGI) wrote that Chularat Hospital Public Company Limited (SET: CHG) reported a strong first quarter in 2026, posting a net profit of THB 248 million, which marks a year-on-year increase of 9.9% and a quarter-on-quarter rise of 10.4%. This result accounts for 25% of KGI’s full-year profit forecast of THB 991 million, keeping the company on track to meet the annual earnings target.
CHG discussed key aspects of its 1Q26 performance and outlook for the remainder of the year in the recent analyst meeting. One notable trend is the rising revenue per bill, which has continued into 2Q26. This increase is attributed to the ongoing economic downturn, which has led to fewer patients with simple diseases but a higher number of high-intensity cases such as heart disease, cancer, and stroke.
CHG’s ability to draw foreign patients, particularly from Myanmar, has supported this growth. Revenue from foreign patients remains steady, contributing 4% to total revenue, consistent with the previous year.
However, the hospital witnessed a decline in outpatient visits from the Middle East due to the conflict between the United States and Iran, with figures dropping 8.4% quarter-on-quarter in 1Q26. Despite this, there was a 6.8% year-on-year increase in this segment, indicating resilience despite geopolitical challenges.
CHG is also advancing its competitiveness by introducing innovative and highly efficient medical treatments. The hospital’s specialized centers, including those for heart, stroke and brain, cancer, hand and microsurgery, gastric sleeve procedures, and trauma care, have contributed to an increase in average revenue per treatment and are positioned as key drivers of future growth.
KGI has recently revised earnings forecasts for CHG, projecting net profits of THB 991 million (up 6.6% year-on-year) in 2026 and THB 1.02 billion for 2027 (up 2.9% year-on-year). CHG’s strategic focus is now on expanding its capabilities in higher-income specialties, which is expected to improve its case mix and maintain profitability even in the face of a weaker domestic economy.
From a valuation perspective, CHG’s share price appears to have bottomed out following recent corrections in the Thai equity market. With a current price-to-earnings ratio estimated at around 15x for 2026-2027, the stock is seen as highly defensive. The company remains in a strong financial position, retaining a net cash status and offering a robust dividend yield of over 5% over the coming years.
Based on these factors, the brokerage maintains an ‘Outperform’ rating for CHG, with a 2026 target price of THB 1.75 per share, using a discounted cash flow methodology that incorporates a WACC of 7.9% and a terminal growth rate of 1%.
