Brokerage sees 96% upside potential in this smallcap stock

Choice Institutional Equities retained its 'BUY' recommendation on Jeena Sikho Lifecare Ltd, citing the company's focus on scaling up its Ayurveda ecosystem. In its report, the domestic brokerage said the management remains focused on adding beds, deepening the preventive care ecosystem and expanding its wellness and product offerings.

According to the brokerage, Jeena Sikho Lifecare is targeting 7,000-10,000 operational beds over the next three to five years through a capital-efficient expansion model.

The company is also guiding for around 30 per cent annual revenue growth, a balanced 50:50 mix between services and products, and a 4-5 times increase in profit after tax (PAT) over the same period, Choice said.

The brokerage added that the management expects EBITDA margin of over 40 per cent and PAT margin of 27-30 per cent to be sustained.

Jeena Sikho Lifecare target price

Choice retained its 12-month target price of Rs 1,000 for Jeena Sikho Lifecare, based on its discounted cash flow (DCF) valuation. The brokerage has assessed the stock at Rs 510, implying an upside potential of around 96 per cent.

Jeena Sikho Lifecare is a smallcap company with a market capitalisation (m-cap) of over Rs 6,300 crore.

Choice projects the company to post revenue, EBITDA and PAT compound annual growth rates (CAGR) of 33.6 per cent, 34.9 per cent and 39.4 per cent, respectively, over FY26-FY29.

The brokerage said its target valuation implies a price-to-earnings (PE) multiple of 28 times based on FY28 estimated earnings per share (EPS), while the PEG ratio stands at 0.8 times.