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Medical tourism weakness in Singapore could be temporary: Maybank

Michelle Zhu
Michelle Zhu6/5/2017 1:37 PM GMT+08  • 2 min read
Medical tourism weakness in Singapore could be temporary: Maybank
SINGAPORE (June 5): Maybank Kim Eng Research continues to rate Raffles Medical Group (RMG) at “buy” as Singapore’s leading integrated healthcare provider, with a “robust track record and exciting development plans” of two hospitals in China.
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SINGAPORE (June 5): Maybank Kim Eng Research continues to rate Raffles Medical Group (RMG) at “buy” as Singapore’s leading integrated healthcare provider, with a “robust track record and exciting development plans” of two hospitals in China.

In a Monday report, analyst John Cheong says he finds the shares of RMG undervalued as it is trading at 32 times FY17 P/E – with its current stock price largely reflecting solely the Singapore operations, without fully accounting for its new hospitals in China.

The research house’s price target estimate, however, has been lowered to $1.54 from $1.67 previously after accounting for greater expansion risks in China given higher execution risks for its Shanghai and Chongqing hospitals, both firsts for the group outside of Singapore; higher-than-expected start-up costs in major expansion markets; and the potential of a continued structural decline of medical tourism Singapore.

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