Credit Suisse downgrades Raffles Medical Group (R01.SG) to Neutral from Outperform, keeps target at $2.10; says 3Q results in line with house estimates, with revenues +10% on-year, earnings +13% on-year at $10.7 million; 9-month revenue, net profit achieving 74%, 71% of FY estimates respectively. 

Says operating margins at 21.7%, tad up from 21.5% year ago, largely due to operational efficiency gains at its flagship hospital; says 4% on-year revenue growth in healthcare segment, 15% on year improvement in hospital operations (from 11% on year in 2Q10), “reaffirms the firm underlying demand across the sector, and recovery in foreign patient load.” 

 

Remains positive on company’s fundamentals, downgrade due to strong outperformance, demanding valuations at 23X FY11E P/E, limited N/T catalysts. Shares down 3.2% at $2.14.