PB Fintech awaiting board approval, to invest Rs 850cr in healthcare company

Yashish Dahiya, Chairman & Group CEO of PB Fintech said the company’s move into the healthcare space is subject to board approval.

Dahiya said that PB Fintech will be a minority investor in the company through which the healthcare foray will happen.

At an event on Friday, PB Fintech’s Co-Founder & Executive Vice Chairman Alok Bansal had mentioned that there will be no reconsideration of the company’s foray into the healthcare space and that it is a necessity of the middle class.

“We very, very firmly believe that’s a very important need for middle class India today. The sort of over-treatment which happen in the hospitals, the frauds which can come into this, any person walking into this hospital, the revenue for the hospital, but it’s a cost for the insurance company. So unless that part is controlled, the consumer trust, and we are talking about middle class India, the consumer trust for that segment will not come. And unless that consumer trust is not there, they will not come to buy. And even if they come to buy, they will not buy, they will just look at the option and go away,” Bansal had said.

Shares of PB Fintech, which as of last week, were on the verge of doubling from their IPO price, have now corrected 15% in the last five trading sessions, but have snapped their losing streak on Monday.

Dahiya also added that PB Fintech may invest up to $100 million in the new healthcare company for a 20% to 30% stake, subject to the approval from the company’s board. He also added that this will be a one-time investment and that PB Fintech has no intention to make a recurring investment in the healthcare company.’

“In India, there is enough demand for healthcare I don’t think that is the challenge. I think everybody has their own market. This is meant for middle-class India that middle-class person cannot afford ₹78,000 per room night. Let’s be very clear,” Dahiya said.

Brokerage firm Bernstein on Friday had maintained its “outperform” rating on PB Fintech with a price target of ₹1,760, saying that investors had invested in PB Fintech for its high growth, strong business model and cash generation, adding that some of those may view this backward integration as a meaningful shift from its capital-light business model, which appears to be weighing on the stock now.

Shares of PB Fintech are trading nearly 4% higher on Monday, snapping a five-day winning streak at ₹1,693.7. The stock has still doubled in value so far in 2024, having risen 110%. CNBCTV18