Rainbow Childrens Medicare Ltd.
NSE: RAINBOWRainbow Childrens Medicare Ltd.: A 30-second snapshot
Rainbow Children's Medicare (RAINBOW) is a Bengaluru-headquartered specialty paediatric hospital chain trading at ₹1,336.20, a PE of 52.9x and a forward PE of 42.5x, with a 5-year revenue CAGR of 11.9% and a profit margin of 15.97%. The stock is 1% lower year-on-year and 18.81% below its 52-week high, though it has returned 9.52% over the past 3 months and now sits marginally above its 200-DMA of ₹1,323.94. Debt-to-equity stands at 53.24 on a rising trend, reflecting continued hospital expansion capex.
P/E
52.9
Forward P/E
42.5
ROE
—
Debt / Equity
53.24
Profit Margin
+16.0%
Div. Yield
+0.2%
5Y ROE > 15%
4/5
5Y FCF > 0
3/5
Quality
61/100
News
8 headlines · 5 positive · 0 negative
Rainbow Children's Medicare Limited Schedules Q4 & FY2025-26 Earnings Conference Call for May 25, 2026 - scanx.trade
scanx.trade
Rainbow Children's Medicare Opens 60-Bed Hospital in HRBR Layout and IVF Centre in Mahadevapura, Bengaluru - scanx.trade
scanx.trade
Rainbow Medicare Adds 60 Beds in Bengaluru With New Hospitals - Whalesbook
Whalesbook
Rainbow launches paediatric super specialty wing - The Hans India
The Hans India
5 Healthcare Stocks to Buy for Your Portfolio; Recommended by HSBC - Trade Brains
Trade Brains
Recent context
- ·RAINBOW opened a 60-bed hospital in HRBR Layout, Bengaluru alongside an IVF centre in Mahadevapura (May 2026), and launched a paediatric super-specialty wing (April 2026) — continuing the footprint expansion strategy that underpins the 5-year revenue growth trajectory.
- ·An earnings conference call for Q4 and full-year FY2026 results is scheduled for 25 May 2026, which will be the next substantive data point on whether the earnings-revenue growth gap has narrowed or widened.
- ·HSBC named RAINBOW among five healthcare stocks in an April 2026 note (per Trade Brains coverage); separately, 10 analysts are tracked against the stock though consensus direction data was not available in this data pull.
Strengths
- +Revenue CAGR of 11.9% over 5 years demonstrates consistent top-line expansion, supported by new facility additions including a 60-bed hospital in HRBR Layout and an IVF centre in Mahadevapura opened in May 2026.
- +FCF was positive in 3 of tracked years and the fundamental consistency score is 78, with ROE above 15% in 4 of tracked years — suggesting the business has maintained a degree of financial discipline alongside its growth phase.
- +At a PE of 52.9x, RAINBOW is priced below sector peers APOLLOHOSP (64.5x) and MAXHEALTH (72.5x), ranking 4th of 6 on PE within the peer set, placing it in the middle of the valuation range for this peer group.
- +News flow over the recent period is skewed positive: 5 of 8 tracked articles carry positive sentiment, 3 neutral, and 0 negative, with coverage centred on facility expansions and a Q4 FY2026 earnings call scheduled for 25 May 2026.
Weaknesses
- −Earnings growth CAGR of 5.6% over 5 years is less than half the revenue CAGR of 11.9%, indicating that operating leverage and margin expansion have not materialised as revenues scaled — a sustained margin compression pattern.
- −D/E of 53.24 on a rising trend represents the most notable balance-sheet concern; with FCF positive in only 3 of tracked years, the capacity to self-fund capex without additional leverage is limited.
- −Quality score of 44 ranks 3rd of 6 in the peer group, and ROE data is unavailable — the composite quality picture is incomplete and mid-tier relative to peers such as MAXHEALTH (quality score 54) and SUNPHARMA (50).
- −The stock is 18.81% below its 52-week high and flat over 12 months (-1%), meaning the recent 3-month gain of 9.52% has only partially recovered prior losses and has not yet cleared the nearest resistance level at ₹1,377.
Open questions
- ?Does the rising D/E trend reflect temporary expansion capex that is expected to stabilise, or does the hospital network require continuous leverage to maintain growth — and how does management characterise the path to peak debt?
- ?The 5-year earnings CAGR of 5.6% versus revenue CAGR of 11.9% raises the question of where the margin drag is originating — is it new-hospital ramp-up costs, staff costs, or pricing pressure in paediatric care?
- ?How does RAINBOW's paediatric and neonatal specialisation compare with the broader multi-speciality footprint of peers like APOLLOHOSP and MAXHEALTH in terms of revenue per bed, occupancy, and EBITDA margin?
- ?Given that the stock trades at a forward PE of 42.5x, what earnings growth rate is embedded in that multiple — and does the FY2026 Q4 result on 25 May 2026 indicate whether that growth rate is achievable?
Peer comparison: Pharma
Ranks 3 of 6 on quality| Symbol | Name | P/E | ROE | Quality |
|---|---|---|---|---|
| RAINBOW | Rainbow Childrens Medicare Ltd.You're viewing | 52.9 | — | 44 |
| Industry avg | across 5 peers | 46.9 | +11.8% | 37 |
| MAXHEALTH | Max Healthcare Institute Ltd. | 72.5 | — | 54 |
| SUNPHARMA | Sun Pharmaceutical Industries Ltd. | 41.3 | — | 50 |
| APOLLOHOSP | Apollo Hospitals Enterprise Ltd. | 64.5 | — | 42 |
| CIPLA | Cipla Ltd. | 29.8 | +11.7% | 24 |
| DRREDDY | Dr. Reddy's Laboratories Ltd. | 26.5 | +11.8% | 17 |
Technical state
Current price
₹1,336.20
SMA 50
₹1,221.72
SMA 200
₹1,323.94
RSI (14)
65.6 (neutral)
From 52w high
-18.8%
1Y return
-1.0%
3M return
+9.5%
50-DMA
Above
200-DMA
Above
Algorithmic support levels
Algorithmic resistance levels
Risk flags
- mediumD/E of 53.24 is elevated and on a rising trend; for a specialty hospital operator, this reflects ongoing capex-driven leverage. FCF-positive in only 3 of tracked years limits the buffer against further debt accumulation.
- mediumEarnings growth CAGR of 5.6% over 5 years materially lags revenue growth CAGR of 11.9% over the same period, indicating sustained margin compression. Profit margin stands at 15.97%.
- lowROE data is unavailable and analyst consensus direction is also absent (10 analysts tracked, rating field null). The quality score of 44 ranks 3rd of 6 sector peers, placing RAINBOW in the mid-tier of this peer group.
- lowStock is 18.81% below its 52-week high. Over 12 months the price is down 1%, while the 3-month gain of 9.52% has returned it just above the 200-DMA (current ₹1,336 vs 200-DMA ₹1,324). The nearest resistance is at ₹1,377.
Cross-section contradictions
- Revenue CAGR of 11.9% over 5 years points to operational scale-up, but earnings CAGR of 5.6% over the same period shows that growth has not flowed through to the bottom line proportionally — consistency score of 78 and 4 of tracked years with ROE above 15% coexist with the margin compression signal.
- The stock is down 1% over 12 months yet up 9.52% over 3 months, having just crossed back above the 200-DMA (₹1,323.94) at a current price of ₹1,336.20 — the near-term price recovery has not yet restored the longer-term performance gap.
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Fundamentals & technicals: refreshed 25 Jun 2026 · refreshed daily at 01:00 IST
AI synthesis (narrative, snapshot, strengths/weaknesses, peer ranking): generated 17 May 2026 · rotates through NIFTY 500 every ~5 days