Akdital: Saham Bank maintains a buy rating and targets 1,700 DH, indicating a potential of +23%

The Akdital stock has experienced turbulence in recent weeks, dropping to 1,135 DH before stabilizing around 1,360 DH. This volatility coincided with several events, including the "GenZ 212" movement, ministerial announcements regarding the health sector that sparked rumors and misinterpretations, the temporary closure of two clinics (in Rabat and Laâyoune), and the prospect of a bond issuance. Following discussions with the group's management, Saham Bank analysts believe that none of these factors undermine Akdital's growth trajectory. The clinic closures are related to technical upgrades and strategic reconfigurations. The planned bond issuance, amounting to 1.2 billion dirhams and pending approval from the AMMC, is intended solely to finance international expansion, particularly in the Middle East. International operations are set to commence in 2026, a year earlier than initially estimated. A significant development is the acceleration of international growth, especially in Saudi Arabia, through a management contract for the Al Mishari Hospital in Riyadh. Classified as a "brownfield" site, the facility will operate under the Akdital brand starting January 2026, one year ahead of schedule. The total project cost is approximately 30 million euros, financed without incurring debt. Projections indicate that the hospital will generate around 300 million dirhams in revenue, which the group aims to increase to 375 million by 2026, targeting an EBITDA margin of 25% in the medium term and 30% in steady state. By 2034, international operations could account for nearly 40% of the group's revenue and 30% of EBITDA, marking a significant scale change for Akdital. There are no plans for a capital increase in the next 2-3 years. In response to market concerns regarding the financing of this expansion plan, Saham Bank reassures stakeholders. The group reports a net debt of less than three times EBITDA, a level considered healthy for a rapidly growing entity. The investment program for 2025-2028, estimated at 8.8 billion dirhams, will be largely supported by projected self-financing capacity of 5.4 billion during the same period. No capital increase is anticipated in the next two to three years, according to management. Investments in "Propco" — real estate companies intended to hold the properties of clinics before transferring them to local partners — will help alleviate medium-term cash flow pressure. Recent announcements from the Ministry of Health regarding new therapeutic protocols and the revision of medical procedure tariffs have raised questions about their potential impact on margins. However, Akdital's management asserts that no proposed measures threaten the economic model's balance in the short term. Saham Bank notes that tariff adjustments could be beneficial for certain segments, particularly in intensive care and critical care, which are currently under-reimbursed. Following this update, Saham Bank only marginally revises its forecasts. The bank maintains its growth assumptions and confirms its target price of 1,700 DH per share, based on sustained revenue growth and gradual profitability improvement. "The group remains on a solid trajectory, with a controlled financial structure and significant international potential. Recent episodes of volatility do not undermine the investment thesis," concludes the note, recommending a buy rating with a target of 1,700 DH.