Thomson Medical Group - Stock Analyst Research

Target Price* 0.66
Recommendation BUY
Market Cap*-
Publication Date25 Mar 2024

*At the time of publication

Thomson Medical Group Ltd - Building a regional healthcare footprint

  • The 70%-owned listed TMC Life Sciences Bhd is recording record earnings and growth from an increase in beds, higher patient load and larger bill size. It has grown its pool of domestic and foreign patients, drawn by improved service standards, relatively lower costs, and weak Ringgit.
  • Earnings contribution from Franco-Vietnam Hospital, acquired at end 2023, will more than offset the absence of government contract for Covid-related work in Singapore. FV extends its geographical reach to a population of 120mn people in Vietnam, Cambodia, and Laos.
  • We estimate the development of the Iskandar landbank could yield a development gain of S$1.1bn. The value of real estate could rise with the completion of the railway link between Singapore and Johor Bahru and the setting up of a free trade zone in the area. We initiate coverage with a BUY recommendation and SOTP TP of S$066.



Thomson Medical Group (TMG) is a regional healthcare group that operates 3 tertiary hospitals with 757 licensed beds in Singapore, Malaysia and Vietnam. It also runs specialist medical clinics and diagnostic imaging centres in Singapore and Malaysia. TMG owns 1mn sq ft freehold land in Johor Bahru, Malaysia, which could be developed into an integrated health and wellness city, including a medical hub under 70%-owned TMC Life Sciences Bhd (TLS).



  • Malaysian operations are the key growth engine. Bursa-listed TLS has enjoyed strong growth since FY20, led by increased bed count, higher patient load, and bigger bill size with a larger scope of treatment. Improved quality of healthcare services and a weak Ringgit are drawing both domestic and foreign patients to seek treatment in Malaysia. TLS has room to increase bed count by more than 50%, from 350 currently.
  • Franco-Vietnam Hospital (FV) extends TMG’s geographical reach to the burgeoning economies of Vietnam, Cambodia, and Laos, with a combined population of 120mn. A full-year contribution from FV in FY25e could lift EBITDA to 12.6% above that of FY23. Founded in 2003, FV is one of Vietnam’s six Joint Commission International (JCI) accredited hospitals. It has 200 doctors offering more than 30 specialties. FV is adding a new wing to raise floor space by 33% from FY26e.
  • Expect a dip in FY24e net profit. Singapore government contracts for Covid-related work, such as managing the vaccination centres and the Transitional Care Facilities, tapered off in 2023. The absence of this income stream and cost incurred in FV purchase could lead to a 65% decline in FY24e net profit but +157% rebound in FY25e with FV contributions.
  • Unlock the value of the Iskandar landbank. The land in Iskandar has a book value of S$91mn as at Jun 23. At current real estate prices, we estimate it could yield a gross development value of S$3.6bn and a development gain of about S$1.1bn when fully developed. Johor’s state government has proposed that Iskandar Malaysia be designated a special economic zone with Singapore. The completion of the Johor Bahru-Singapore Rapid Transit System Link (RTS) at the end of 2026 could revitalise the region and lift the value of the real estate.


Initiate coverage with a Buy recommendation and TP of S$0.066

Our TP is based on the sum-of-the-parts valuation methodology. The healthcare operations are valued at an industry average of 12.5x FY25e EV/EBITDA. We estimate the 1mn sq ft of freehold land at Iskandar, Malaysia, could reap a development gain of S$1.1bn.



TMG owns and operates three tertiary hospitals. These include the flagship women hospital, Thomson Medical Centre (TMC) in Singapore, Thomson Hospital Kota Damansara in Kota Damansara, Malaysia held under 70%-owned TMC Life Sciences Bhd (TLS), and Franco-Vietnam Hospital (FV) in Ho Chi Minh City, Vietnam which was acquired in Dec 2023. The hospitals have a total 757 licensed beds.

It also runs a chain of specialist medical centres and diagnostic centres in Singapore, fertility centres in Malaysia, and chiropractic clinics in Vietnam.

TMG owns 1m sq ft of freehold land in Iskandar, Malaysia, and Johor Bahru City Centre. It plans to develop these areas into an integrated health and wellness city. TLS also plans to develop Thomson Iskandar Medical Hub with 500 beds in Iskandar.




Established in 1979, Thomson Medical Centre is one of the largest private providers of healthcare services for women and children in Singapore. It also operates a network of specialist medical clinics and facilities providing diagnostic imaging, gynaecological oncology, specialist dermatology and Traditional Chinese Medicine.

Singapore has been the key earnings pillar, with the highest healthcare expenditure per capita in Southeast Asia and growing at a 5-year CAGR of 5.7% (Figure 9 & Figure 10). TMG also enjoyed a bump in profits in the last two years from government contracts to manage vaccination centres and Transitional Care Facilities. These jobs tapered off at end-2023. We expect Singapore’s FY24e revenue to return to FY21’s level.



About the author

Peggy Mak
Research Manager

Peggy has been a sell-side equity analyst for 22 years and a fund manager for 15 years.

Latest Reports

Contact us to Open an Account

Need Assistance? Share your Details and we’ll get back to you


This material is provided by Phillip Capital Management (S) Ltd (“PCM”) for general information only and does not constitute a recommendation, an offer to sell, or a solicitation of any offer to invest in any of the exchange-traded fund (“ETF”) or the unit trust (“Products”) mentioned herein. It does not have any regard to your specific investment objectives, financial situation and any of your particular needs. You should read the Prospectus and the accompanying Product Highlights Sheet (“PHS”) for key features, key risks and other important information of the Products and obtain advice from a financial adviser (“FA“) pursuant to a separate engagement before making a commitment to invest in the Products. In the event that you choose not to obtain advice from a FA, you should assess whether the Products are suitable for you before proceeding to invest. A copy of the Prospectus and PHS are available from PCM, any of its Participating Dealers (“PDs“) for the ETF, or any of its authorised distributors for the unit trust managed by PCM.  

An ETF is not like a typical unit trust as the units of the ETF (the “Units“) are to be listed and traded like any share on the Singapore Exchange Securities Trading Limited (“SGX-ST”). Listing on the SGX-ST does not guarantee a liquid market for the Units which may be traded at prices above or below its NAV or may be suspended or delisted. Investors may buy or sell the Units on SGX-ST when it is listed. Investors cannot create or redeem Units directly with PCM and have no rights to request PCM to redeem or purchase their Units. Creation and redemption of Units are through PDs if investors are clients of the PDs, who have no obligation to agree to create or redeem Units on behalf of any investor and may impose terms and conditions in connection with such creation or redemption orders. Please refer to the Prospectus of the ETF for more details.  

Investments are subject to investment risks including the possible loss of the principal amount invested. The purchase of a unit in a fund is not the same as placing your money on deposit with a bank or deposit-taking company. There is no guarantee as to the amount of capital invested or return received. The value of the units and the income accruing to the units may fall or rise. Past performance is not necessarily indicative of the future or likely performance of the Products. There can be no assurance that investment objectives will be achieved.  

Where applicable, fund(s) may invest in financial derivatives and/or participate in securities lending and repurchase transactions for the purpose of hedging and/or efficient portfolio management, subject to the relevant regulatory requirements. PCM reserves the discretion to determine if currency exposure should be hedged actively, passively or not at all, in the best interest of the Products.  

The regular dividend distributions, out of either income and/or capital, are not guaranteed and subject to PCM’s discretion. Past payout yields and payments do not represent future payout yields and payments. Such dividend distributions will reduce the available capital for reinvestment and may result in an immediate decrease in the net asset value (“NAV”) of the Products. Please refer to <> for more information in relation to the dividend distributions.  

The information provided herein may be obtained or compiled from public and/or third party sources that PCM has no reason to believe are unreliable. Any opinion or view herein is an expression of belief of the individual author or the indicated source (as applicable) only. PCM makes no representation or warranty that such information is accurate, complete, verified or should be relied upon as such. The information does not constitute, and should not be used as a substitute for tax, legal or investment advice.  

The information herein are not for any person in any jurisdiction or country where such distribution or availability for use would contravene any applicable law or regulation or would subject PCM to any registration or licensing requirement in such jurisdiction or country. The Products is not offered to U.S. Persons. PhillipCapital Group of Companies, including PCM, their affiliates and/or their officers, directors and/or employees may own or have positions in the Products. Any member of the PhillipCapital Group of Companies may have acted upon or used the information, analyses and opinions herein before they have been published. 

This advertisement has not been reviewed by the Monetary Authority of Singapore.  


Phillip Capital Management (S) Ltd (Co. Reg. No. 199905233W)  
250 North Bridge Road #06-00, Raffles City Tower ,Singapore 179101 
Tel: (65) 6230 8133 Fax: (65) 65383066