SINGAPORE (Oct 27): OCBC is keeping its “hold” recommendation for Raffles Medical Group with a target price of $4.59.

In 3Q15, Raffles Medical’s revenue rose 7.4% to $101.5 million from a year ago, meeting 24.3% of OCBC’s full-year forecast.

Revenue from Hospital Services and Healthcare Services divisions had increased by 11.7% and 3.5% respectively, supported by volume growth of local patients.

While volume from foreign patients was down, the group is seeing greater intensity cases from them such as bone marrow transplant programmes.

In a Tuesday report, lead analyst Jodie Foo says the volume of foreign patients from Indonesia and Russia was hit by several external factors such as the weaker macro environment in their home countries and weakening home currency against SGD, leading some patients to look for cheaper alternatives in other markets such as Malaysia.

To rectify the situation, the group’s is diversifying into countries including Vietnam.

Recall that the group had recently concluded the acquisition of International SOS (MC Holdings) for 10 clinics in China, Vietnam and Cambodia through a JV.

“We understand that this business is profitable and these clinics will eventually be branded under Raffles Medical Group, as well as support the group’s network in Singapore, Hong Kong and China,” says Foo.

Raffles Medical is down 0.9% at $4.35.