Rajthanee Hospital Public Company Limited

Dr. Surin Prasitthihiran, Managing Director of Ratchathani Hospital Public Company Limited, or RJH, disclosed that second-half operating results are expected to grow better than target, particularly in the third quarter of 2026, supported by a recovery in the gastric surgery patient group, the high season for the hospital business, and more efficient cost management. Revenue from health check-ups at the group's three hospitals rose compared with the same period last year. In the fourth quarter of 2026, revenue may slow seasonally, but the company is still maintaining good expense control efficiency. The highlight is Ratchathani Hospital Nong Khaek, a new hospital in the group, which has shown significant improvement. It had been expected to return to profit around the end of this year, but based on a preliminary assessment in September, it is now expected to turn profitable as early as the third quarter of 2026, about three months ahead of the original estimate. It currently operates one ward with 31 beds and has an average occupancy of about 20 beds. Meanwhile, Ratchathani Hospital Rojana, registered for 100 beds, actually operates 31 beds with an occupancy rate of about 70%. On social security, the medical service fees paid to contracted hospitals are under review, covering the per-head capitation payment, treatment of chronic diseases, and complex diseases with RW greater than 2. The review is expected to be completed by October 24, 2026. The current capitation rate stands at 1,808 baht per person per year. The three hospitals currently have a combined base of about 270,000 insured persons, and this is expected to rise to 280,000 by the end of this year. If the process proceeds within the expected framework, the increase in the social security capitation rate may be announced and take effect from January 1, 2027. The company targets revenue growth of no less than 10% this year.

Kasikorn Securities maintains its "Buy" rating on Rajthanee Hospital Public Company Limited, or RJH, and has raised its mid-2027 target price to 17.70 baht from 17.20 baht after revising up its profit forecasts. It expects normalized profit in the third quarter of 2026 to grow a strong 63% year on year to 134 million baht, driven by revenue growth from the Social Security Office, or SSO, and margin expansion, even as revenue from cash-paying patients weakens. Management is maintaining its revenue growth target of more than 10% amid weak economic conditions and purchasing power. The research team values the stock using a DCF method with a WACC of 7.7%, based on 293 million shares outstanding, excluding treasury shares, reflecting a PER of 12.2 times in 2026 and 12.7 times in 2027, versus RJH's nine-year historical average of 19.7 times and one standard deviation below the average at 9.5 times. It also implies a dividend yield of 5.1% in 2026 and 2027. If the SSO does not raise its service rates, the DCF-derived value would fall 5% to 16.90 baht from 17.70 baht. RJH trades at a PER of only 10 to 11 times in 2026 and 2027, the lowest in the sector, with a dividend yield of 5.9%. Downside risks include weaker-than-expected purchasing power in Phra Nakhon Si Ayutthaya province, no increase in SSO service rates, and negative regulatory changes.

Analysts at Yuanta Securities (Thailand) said the Social Security Office is reviewing the medical service fees it pays to contracted hospitals, covering per-head capitation, treatment of chronic diseases, and complex cases with RW>2. The review is expected to be completed by 24 October 2026. The per-head capitation rate currently stands at 1,808 baht per person per year, while the size of the increase and the date it takes effect have not yet been officially concluded. The brokerage views this as a positive sentiment and an upside to profit forecasts for hospital stocks with a high share of Social Security revenue, namely RJH at about 49% of revenue, BCH at 36%, CHG at 28%, CMR at 27%, and BDMS at 3%. If the per-head capitation rate rises 1%, it is expected to lift profits by about 3.1% for RJH, 2.6% for BCH, 1.91% for CHG, 0.36% for CMR, and 0.16% for BDMS, and if it rises 5%, it would lift profits by about 15.3%, 13.0%, 9.55%, 1.81%, and 0.81% respectively. The brokerage has not yet included this upside in its forecasts until the new rate and effective date are clear, so it maintains an overweight stance on the sector, picks CHG as its top stock, and recommends buying with a fundamental value of 2.15 baht.

Kasikorn Securities assesses that the two-week delay in the election of the Social Security Office board is unlikely to affect the approval of adjustments to medical treatment service rates, which are currently under review by the subcommittee considering medical treatment rate levels. The new SSO board is expected to begin work within November, later than the previously expected October, and the board will be the one to approve the subcommittee's meeting results and set the effective date of the new service rates. Currently, the subcommittee is scheduled to hold its third meeting on October 5, at which a conclusion on the rate adjustment is expected. If no conclusion is reached, a fourth meeting may be needed on October 24, which must be held before that date because it is when the subcommittee's term expires. The research team maintains a neutral view on the hospital sector, with PR9 as its top pick, and holds a positive view that the subcommittee will consider raising the flat-rate payment by 5%, assuming the flat-rate adjustment takes effect from 2027 onward in its profit forecasts for the three social security hospital stocks under coverage. It recommends buying BCH with a target price of 12.50 baht and RJH with a target price of 17.20 baht, and recommends holding CHG with a target price of 1.69 baht. However, if the Social Security Office does not raise service rates at all, the DCF value would fall 5% for BCH to 11.9 baht, fall 4% for RJH to 16.50 baht, and fall 4% for CHG to 1.69 baht.

The Cabinet meeting approved in principle a draft royal decree to extend Social Security coverage under Section 33 to three groups of employees previously exempted: those in agriculture, forestry, and animal husbandry; employees of individual employers; and employees of stall-holder employers. This is expected to add 550,000 insured persons in 2026 and 1.05 million by 2030. Krungsri Securities views this as a positive sentiment for hospital groups treating insured patients, with upside to revenue in the medium to long term. Hospitals with the highest social security revenue in the first half include BCH at 38% and CHG at 30%, while RJH has 53%, SKR 36%, VIH 26%, and PHG 40%. The firm maintains a bullish stance on the hospital group, expecting profits to have passed the trough, supported by the high season and the increase in social security treatment rates. Top picks are BDMS with a target price of 25 baht and PR9 with a target price of 24 baht. BCH, with a target price of 12 baht, is the biggest beneficiary if treatment rates are adjusted.

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.

Nine listed hospital companies reported standout profit growth in the second quarter of 2026 compared with a year earlier. RJH posted net profit of 112.85 million baht, up 79.63%, while RAM recorded net profit of 344.58 million baht, up 28.55%, and EKH posted net profit of 60.18 million baht, up 27.87%, helped by more Thai and foreign patients, branch expansion, and revenue from specialised medical centres. CGSI said earnings at the six hospital companies it covers appear to have passed their trough, with combined normalised profit down 2% from a year earlier and down 8% from the previous quarter. Excluding RAM, combined normalised profit fell 4% from a year earlier and 10% from the previous quarter. CGSI maintained an Overweight rating on the hospital sector and selected BH and PR9 as top picks because they have a high proportion of foreign patients and are likely to recover better than peers.

Ratchathani Hospital Public Company Limited, or RJH, revealed that the number of insured persons under the social security system totals approximately 261,000, exceeding the original target set for the end of 2026 of about 260,000 and achieved ahead of schedule. This comprises roughly 196,000 at Ratchathani Hospital, about 45,000 at Ratchathani Rojana Hospital, and around 20,000 at Nong Khae Hospital. Meanwhile, the company expects third-quarter 2026 operating performance to grow better than the same period last year, driven by a rise in service users, especially surgical cases among insured persons, and the remainder of 2026 entering the high season for the hospital business, which should clearly lift the number of patients seeking examinations and treatment. RJH maintains its 2026 revenue growth target of about 10 percent from 2025, after recording total revenue of 1.527 billion baht in the first half of 2026 and announcing an interim dividend of 0.45 baht per share, with the ex-dividend date set for 26 August 2026 and payment on 10 September 2026. Analysts at DBS Vickers Securities Thailand Company Limited maintain a buy recommendation on RJH with a target price of 18.60 baht, expecting third-quarter 2026 profit to grow from the same period last year, reflecting a notable increase in social security patients.