Affordability wall drives institutional exit from Thai healthcare stocks

Patient shift to public hospitals capped Thailand’s private healthcare growth at 3%.

Investor interest in Thailand’s healthcare sector has softened, with many institutional funds holding minimal exposure to hospital stocks, according to a report by Maybank Securities (Thailand).

The research released on 2 February, which reviewed listed Thai hospital operators, found that foreign investors, particularly those based in Kuala Lumpur and Singapore, remain cautious due to limited domestic growth and weaker patient affordability.

As a result, healthcare equities are no longer a priority allocation for many funds, the report said.

Maybank Securities maintained a neutral outlook on the sector, citing subdued earnings growth and competitive pressures.

It named Bangkok Dusit Medical Services (BDMS) as its top pick, pointing to its relatively stronger earnings visibility and more resilient valuation.

Bangkok Chain Hospital (BCH) was highlighted as a secondary preference, though analysts flagged that expansion-related capital spending could weigh on returns.

The report said private hospitals are facing pressure as more patients shift to public facilities, limiting pricing power.

Cost inflation and competition among private providers are also constraining margins.

Despite these challenges, Maybank Securities noted that current valuations already reflect much of the downside risk.

Select operators with exposure to international patients or strategic partnerships may still find support, it added.

The brokerage expects healthcare revenue growth of around 3% to 4% in fiscal 2026, describing the outlook as stable but lacking near-term catalysts for a sector-wide re-rating.