KUALA LUMPUR: Turkiye's healthcare spending has seen tremendous growth over the past five years, putting IHH Healthcare Bhd on strong footing there through hospital subsidiary Acibadem.
The country's healthcare spending grew at a 24.2 per cent compounded annual growth rate between 2016 and 2021, according to RHB Research.
This was driven by a spike in non-communicable and chronic diseases such as cancer, diabetes, and chronic respiratory diseases as a result of ageing, smoking, reduced physical activity and rising pollution.
Despite the rapid growth of healthcare expenditure, RHB Research said total spending as a percentage of Turkiye's gross domestic product was only 4.9 per cent in 2021, trailing behind Europe's average of 10 per cent.
RHB Research continues to prefer IHH Healthcare for its solid execution strategy and reputable regional footprint across key regions, driven by its strong brand awareness and affluent clientele.
It maintained its "Buy" call on IHH Healthcare with RM6.90 target price."We were invited by IHH Healthcare to attend a four-day site visit in Istanbul. We were pleasantly surprised by the advanced medical facilities at the Acibadem hospitals," the firm said.
Acibadem has 24 hospitals and 14 outpatient clinics across five countries, five of its 24 hospitals are Joint Commission International certified for being the international gold standard for quality and patient safety.
Acibadem accounted for 30 per cent of IHH's revenue in the second quarter (Q2) of 2023 compared to 23 per cent a year ago.
The spike in segmental revenue contribution is attributed to the commencement of Atasehir Hospital in September 2022 and the acquisitions of Ortopedia hospital in August 2022 and Kent Group in February 2022.
In terms of patient volume, the group reported 60,333 patient footfalls in Q2 2023, with a bed occupancy rate (of 67 per cent, which surpassed pre-pandemic levels.