BH – 3Q26F: A strong quarter

We expect BH to report a 3Q26 core profit of Bt2.2bn, up 6% YoY and 14% QoQ, driven by seasonal demand and pent-up demand following treatment deferrals by both international and Thai patients in 2Q26. We expect earnings growth to accelerate from 2% YoY in 1H26. We expect earnings momentum to remain positive through 4Q26. Meanwhile, market forecasts currently imply flat YoY earnings growth in 4Q26, suggesting potential upside to consensus estimates. Following a 5% share price decline over the past month, strong 3Q26 results could act as a near-term catalyst. BH remains one of our top picks, and we maintain our OUTPERFORM rating with a mid-2027 TP of Bt245.

3Q26F preview: Strong quarter with accelerating YoY growth. We expect BH to report a 3Q26 core profit of Bt2.2bn, up 6% YoY and 14% QoQ. While the third quarter typically benefits from seasonal disease-related demand, we believe this year will receive an additional boost from pent-up demand following treatment deferrals by both international and Thai patients in 2Q26. As a result, we expect 3Q26 core earnings growth to accelerate from the 2% YoY growth recorded in 1H26. BH is scheduled to release its 3Q26 results on November 12, 2026.

We forecast 5% revenue growth, ahead of BH's guidance. We estimate 3Q26 revenue at Bt6.8bn, up 5% YoY and 9% QoQ, exceeding BH's guidance of 3% YoY growth, supported by solid performance from both international and Thai patient segments. We forecast international patient revenue (67% of total revenue) at Bt4.6bn, up 6% YoY and 11% QoQ, driven by improving travel conditions, particularly from the Middle East, where arrivals to Thailand returned to growth in 3Q26 (+13% YoY versus -33% YoY in 2Q26). We also expect continued strength from Myanmar and an easing of the low-base effect from Cambodian patients following the decline in patient volumes since 3Q25. We forecast Thai patient revenue (33% of total revenue) at Bt2.2bn, up 3% YoY and 6% QoQ, versus a 3% YoY contraction in 1H26, supported by pent-up demand and seasonal respiratory illnesses. Supported by healthy revenue growth, we forecast a 3Q26 EBITDA margin of 42.5%, up from 40.9% in 3Q25 and 41.1% in 2Q26.

OUTPERFORM maintained. Our 9M26 earnings forecast accounts for 75% of our full-year estimate, implying continued YoY earnings growth in 4Q26, albeit with a seasonal QoQ decline. Consensus estimates remain below our forecasts and imply flat YoY earnings in 4Q26, leaving some room for potential earnings upgrades. BH currently trades at 19x 2027F PE, below its historical average of 21x. We maintain our OUTPERFORM rating and mid-2027 DCF-based TP of Bt245, based on a WACC of 7.7% and LT growth of 2.5%.

Long-term growth runway. BH is entering its first major capacity expansion in nearly two decades. The new Phuket hospital and Bangkok campus expansion could lift bed capacity by 47%, from 580 to 851 beds, improving earnings visibility beyond 2027. While near-term earnings dilution during the ramp-up phase is unavoidable, BH's attractive 2027-28 dividend yield of 4-5% should help cushion downside risk until the new capacity begins contributing meaningfully to earnings.

Risks. Global economic slowdown and geopolitical risk that may cause clients to delay elective medical care and make it inconvenient for international patients to come to Thailand for treatment. We see ESG risk as patient safety (S): BH has adopted a variety of quality assurance systems to provide continuous patient care.