Bangkok Dusit Medical Services Public Company Limited

The earnings season for Thai listed companies in Q2/2026 has come to a close, with overall profits of 678 companies rising 13%, but the hospital group showed signs of a weak pulse. BDMS reported a net profit of 3,248 million baht, down 7% from the previous year, while BH's profit increased only 1.7% to 1,889 million baht, and BCH's profit fell 11.6% to 343 million baht. Meanwhile, PR9's profit rose 1.3% to 184 million baht, LPH fell 17.86% to 46 million baht, RPH dropped 27.79% to 26 million baht, and WPH declined 62.1% to 19 million baht. PRINC still posted a loss of 138 million baht, but the loss narrowed from the previous year. On the other hand, RJH's profit surged 89% to 113.72 million baht, and EKH increased 27.88% to 60 million baht. It is expected that Q3/2026 will recover as the rainy season is the peak season.

Bualuang Securities assesses that hospital stocks have already passed their low point of the year in the second quarter and will recover in the third quarter, driven by seasonal factors and pent-up demand from the Middle East. Combined core profit of the four hospital stocks under coverage was 5.7 billion baht, down 4% year-on-year and 10% quarter-on-quarter, on combined revenue of 37 billion baht, up 1% year-on-year but down 3% quarter-on-quarter. The quarterly decline came from softer Thai patient volumes due to seasonality and economic conditions, while the fly-in business continued to grow. Average gross margin was 36.5%, down 110 basis points year-on-year and 90 basis points quarter-on-quarter, due to higher depreciation from capacity expansion. BH and PR9 still posted profit growth from fly-in demand, while BDMS was most affected by fewer Cambodian patients. BCH beat estimates as social security revenue helped offset weaker general patient volumes. For the third quarter, the picture improves as flights between the Middle East and Bangkok return to pre-conflict levels, combined with the high season for both Thai and fly-in patients. July data already show revenue increasing both year-on-year and month-on-month. On financial positions, BH stands out most, with second-quarter ROE rising to 27.6% from 21.9% in the first quarter and 25.9% in the second quarter last year, along with the highest net cash position in the group. BDMS is the only company with net debt, but its debt-to-equity ratio is only 0.1 times. Bualuang maintains an overweight stance on the hospital sector relative to the market, with BH as the top pick on the recovery of Middle Eastern patients and a strong financial position across the board. For BDMS, Bualuang keeps a buy rating with a target price of 23 baht for end-2027, viewing the second quarter as likely the low point. July revenue trends have started to return to year-on-year growth for both Thai and foreign customers, leading to expectations that third-quarter core profit will increase both year-on-year and quarter-on-quarter. Third-quarter support comes from the disease outbreak season, no high base from Cambodian customers as in the previous year, and Myanmar revenue still growing strongly at 42% year-on-year in the second quarter, continuing from 43% year-on-year in the fourth quarter last year and the first quarter this year. Third-quarter gross margin is expected to rise to 35-37% from a higher proportion of more complex cases. Net debt-to-equity is only 0.1 times, and second-quarter receivable turnover rose to 43 times, up 7% year-on-year. Inventory turnover was 16 times, above the group average of 12 times. The stock trades at a price-to-earnings ratio of about 18 times, below the long-term average by 1.5 standard deviations. First-half profit accounted for 45% of the full-year estimate, close to the normal proportion, so full-year profit is still seen as in line with estimates. For BH, Bualuang keeps a buy rating with a target price of 220 baht and still selects it as the standout hospital stock. The third quarter has two main supports at the same time: the recovery of Middle Eastern patients travelling for treatment and the high season for Thai patients. Higher treatment intensity per case supports both revenue and gross margin, even though foreign patient numbers have not fully recovered. Third-quarter core profit is expected to grow faster year-on-year than in the second quarter and to increase quarter-on-quarter on seasonality. Preliminary July data indicate that Thai patients have started to increase from rainy-season illnesses, while flight routes from the Middle East have returned to pre-conflict levels, although patient numbers still lag. The impact of Cambodian patients suspending services after the border incident on 24 July 2025 will not affect third-quarter figures. On financial position, second-quarter ROE was 27.6%, up from 21.9% in the first quarter and 25.9% in the second quarter last year, clearly higher than other stocks in the group. The company has a net cash position and receivable turnover rose to 84 times from 59 times in the second quarter last year. The stock trades at a 2027 price-to-earnings ratio of about 18 times, while the target price of 220 baht is based on a price-to-earnings ratio of 21 times, or one standard deviation below the 10-year average of 30 times. Dividends are an additional upside, with the first-half interim dividend of 4 baht per share higher than expected. If a special dividend is paid at the same proportion as in 2025, dividend yield would rise to 6.0%, compared with a base case of 2.6%. However, the main point of the investment idea still places more weight on a return to profit growth than on dividends as a supplement.

Asia Plus Securities expects hospital group profit to recover in the third quarter of 2026, growing both quarter-on-quarter and year-on-year, after second-quarter revenue fell 2.9% from the previous quarter but still rose 1.0% from a year earlier, supported by Middle Eastern patients returning after Ramadan and the easing of the Iran situation. Meanwhile, the group's normalized profit fell 5.0% from a year earlier and 12.0% from the previous quarter, led by Bangkok Dusit Medical Services falling 9% and Bangkok Chain Hospital falling 6%, while Bumrungrad Hospital and Praram 9 Hospital posted profit growth of 1.7% and 1.3% respectively. The research team maintained a market-weight rating on the hospital group, selected Bumrungrad Hospital and Praram 9 Hospital as top picks, with fair values of 220.00 baht and 22.00 baht respectively, while Bangkok Dusit Medical Services is a tactical top pick with a maintained buy recommendation and a fair value of 23.00 baht.

UBS has raised its target for the Thai stock market index to 1,680 points in its base case. In the best case, the index could climb to test a high of 1,840 points, while in the worst case it could fall to 1,460 points. The bank also recommends six top picks: CP All, Central Pattana, Gulf Energy Development, Krung Thai Bank, PTT, and True Corporation. At the same time, it has removed Advanced Info Service, Bangkok Dusit Medical Services, Berli Jucker, and Asset World Corp from its recommended list. Trading data from the start of the year through 17 August 2026 shows UBS has accumulated net sales of 5.50 billion baht, with net sales of 3.24 billion baht in August alone. Mongkol Puangpetra, managing director of Apollo Wealth Securities, views the 1,680-point level as a target many parties have already assessed, but reaching 1,820 points would be very challenging. Even though second-quarter profit for the Thai stock market hit a record high of about 380 billion baht, and trailing twelve-month profit reached 1.2 trillion baht, he recommends gradually selling to lock in profits when the index approaches 1,630 to 1,650 points, and keeping an eye on PTT and PTT Exploration and Production, which may pay higher-than-normal dividends.

Asia Plus Securities' research team has issued an analysis of hospital stocks BDMS and BH after their second-quarter 2026 earnings announcements, expecting profits at both companies to recover clearly in the second half of the year. BDMS reported normalized profit of 3.176 billion baht in the second quarter of 2026, down 21.7 percent quarter-on-quarter and 9.0 percent year-on-year, due to higher drug and medical supply costs as well as depreciation from the opening of the new Bangkok Hospital Hua Hin building and the bed expansion at Bangkok Hospital Surat. The research team maintained its 2026 normalized profit forecast at 15.918 billion baht, down 1.7 percent year-on-year, and kept a buy recommendation with a target price of 23.00 baht. BH reported net profit of 1.89 billion baht in the second quarter of 2026, up 1.7 percent year-on-year and 5.5 percent quarter-on-quarter, supported by revenue from international patients rising 7.1 percent year-on-year, and announced an interim dividend of 4.00 baht per share, representing a dividend yield of 2 percent, with the stock going ex-dividend on August 28. The research team maintained its 2026 net profit forecast at 7.714 billion baht, growth of 2.7 percent year-on-year, and upgraded its recommendation to buy from speculative, with a 2027 target price of 220 baht.

Asia Plus Securities assesses BDMS after normalised profit for the second quarter of 2026 came in at 3.176 billion baht, down 21.7% quarter-on-quarter and 9.0% year-on-year, but close to expectations. Earnings were pressured by higher drug and medical supply costs, as well as depreciation from the opening of the new Bangkok Hospital Hua Hin building and the bed expansion at Bangkok Hospital Surat Thani. As a result, EBITDA margin fell to 22.0% from 22.6% in the second quarter of 2025. Although hospital revenue declined 4.5% quarter-on-quarter due to seasonality, it still grew 0.8% year-on-year, supported by a 2% increase in Thai patient revenue, helped by complex disease treatment and an earlier-than-usual outbreak of influenza and COVID-19. International patient revenue fell 2% year-on-year due to a 67% contraction in Cambodian patients and a 24% decline in Middle Eastern patients. Excluding these two markets, international patient revenue still grew 10% year-on-year, supported by a 42% increase in Myanmar patients, 23% from the United States, and 17% from Australia. The research team maintains its 2026 normalised profit forecast at 15.918 billion baht, down 1.7% year-on-year, and views the second quarter as the low point of the year. Profit is expected to recover clearly in the second half, driven by the return of international patients, the high season for Thai patients, and a lower comparison base. The team maintains a buy recommendation with a target price of 23.00 baht.

Bangkok Dusit Medical Services, or BDMS, reported second-quarter net profit for 2026 of 3.25 billion baht, down 6.92% from 3.49 billion baht in the same period last year. Although total operating revenue rose 1% to 27.51 billion baht, it was pressured by operating costs and expenses rising faster than revenue, bringing EBITDA to 6.06 billion baht, down 1%, and the EBITDA margin down to 22.0% from 22.6%. The net profit margin fell to 11.8% from 12.9%. A key pressure came from international patient revenue, which declined 2% after being affected by the Thai-Cambodian border conflict and unrest in the Middle East. Revenue from Cambodian patients fell 67% and from Middle Eastern patients fell 24%, while inpatient revenue declined 1% and the bed occupancy rate dropped to 55% from 61%. Operating expenses including depreciation rose 3% to 23.31 billion baht from 22.66 billion baht, mainly due to higher physician fees, drug and medical supply costs, and depreciation and amortisation from the expansion of the hospital network. However, results were supported by Thai patient revenue rising 2%, and international patient revenue excluding Cambodia and the Middle East still growing as much as 10%, helped by a 42% increase in patients from Myanmar, a 23% increase from the United States, and a 17% increase from Australia. For the first six months of 2026, the company posted net profit of 7.31 billion baht, down 6.76% from 7.84 billion baht in the same period last year, while total operating revenue was 56.07 billion baht, up 1%, and EBITDA was 13.07 billion baht, down 2%.

US stocks closed sharply lower after the Federal Reserve voted 9 to 3, a non-unanimous decision, to keep short-term interest rates at 3.50 to 3.75 percent, while reiterating its 2 percent inflation target. The Dow Jones Industrial Average ended at 51,594.14 points, down 1,153.18 points or 2.19 percent. The S&P 500 fell 1.52 percent and the Nasdaq dropped 1.74 percent, pressured by AI chip stocks ahead of earnings reports from Microsoft and Meta Platforms. West Texas Intermediate crude oil surged 6.56 percent to close at 84.46 dollars per barrel, and Brent crude jumped 7.91 percent to 90.74 dollars per barrel, on concerns that escalating tensions in the Middle East could disrupt supply. Reports indicated that Iran attacked US forces, and the US together with Saudi Arabia struck Iran-backed militant groups in Iraq. For the Thai stock market, CGS International Securities Thailand, or CGSI, expects the SET Index to undergo a minor correction within a range of 1,615 to 1,640 points, pressured by the global stock sell-off and Middle East tensions. The firm recommends BDMS and PTTEP. BDMS is forecast to see normalized profit in the second quarter of 2026 decline 7 percent year-on-year and 20 percent quarter-on-quarter, but revenue in 2027 is expected to grow 7 percent from 2026. PTTEP is supported by strong gas prices and sales volumes in the second half of 2026.

Shares of Bangkok Dusit Medical Services, or BDMS, fell 1.52% after brokers forecast second-quarter 2026 profit would be the lowest this year, due to the impact of the war between the United States and Iran. KGI Securities Thailand expects core profit for the second quarter of 2026 at 3.24 billion baht, down 6.8% year-on-year and down 19.4% quarter-on-quarter. Net profit is expected at 3.31 billion baht, down 5.1% year-on-year and down 18.4% quarter-on-quarter, with an extraordinary item from flood insurance claims in the south of about 72 million baht. The research unit maintains its full-year 2026 profit forecast at 16.1 billion baht, up 1.7% year-on-year, and 2027 at 17.7 billion baht, up 9.8% year-on-year. It keeps a buy recommendation and adjusts the target price to mid-2027 at 23.50 baht.