“Market efficiency initiatives and an iEdge Next 50 inclusion should support institutional demand, alongside buybacks and dividends,” says Jaiswal.
The analyst also predicts that the Government’s Integrated Shield Plan (IP) rider reset should improve affordability and claims discipline for Raffles Medical.
On the upcoming FY2025 results, Jaiswal predicts a return of growth for Raffles Medical, with 16% y-o-y core PATMI growth in 2HFY2025 driven by continued recovery in its Singapore hospital’s operation and narrowing of the drag from its China operations.
Raffles Medical will be announcing its FY2025 results on Feb 23 before the market opens.
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“We expect momentum to extend into FY2026 and FY2027 with core PATMI growth of 14% and 17% respectively, supported by improving contribution from its China operations and a gradual return to sustained profits in the insurance business. Our FY2026 and FY2027 forecasts are above consensus,” states Jaiswal.
Meanwhile, from Apr 1, new IP riders cannot cover MOH-set minimum deductibles and must carry a copayment cap of at least SGD6,000 (excluding the minimum deductible), while
the minimum 5% co-payment remains.
Jaiswal foresees that this could be a mild headwind for Raffles Medical’s hospital volumes, particularly for lower acuity and more discretionary cases, as patients face higher out-of-pocket costs.
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“That said, the tighter rider structure should curb claims-led cost inflation, supporting
private healthcare affordability and, by extension, demand sustainability over the medium term,” comments Jaiswal.
From the analyst’s perspective, he foresees the revised rider framework will improve underwriting quality for new customers at Raffles Medical’s insurance business by curbing claim frequency and low-value utilisation.
“However, the lower rider premiums means that Raffles Medical’s growth focus will shift to policy count and mix.”
“This also creates a differentiation opportunity where the market has noted Raffles Medical’s ability to hold rider premiums flat for two consecutive years, and in the new regime, disciplined claims management and stronger provider network governance should support retention and new business momentum,” says Jaiswal.
As at 9.55am, shares in Raffles Medical are trading 1 cent lower, or 0.99% down at $1.01.
