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Apollo Hospitals: Scaling Healthcare

Britannia plans to add more than 2 lakh outlets every year. It has enhanced its direct reach, which now stands in excess of 15 lakh units

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Prathap C. Reddy’s vision was to set up a healthcare chain so that no Indian would look overseas for the best in class therapy. His vision has been translated into market leadership as Apollo Healthcare today stands as India’s largest private healthcare service provider and Asia’s largest healthcare group. In numbers, its presence expands over 9,200 beds across 64 hospitals, 2,500 pharmacy chains, over 90 primary care and diagnostic clinics, 110 plus telemedicine centres and 80 plus Apollo Munich Insurance branches spanning the length and breadth of the country. From launching new hospitals to making strategic changes, the healthcare chain is in our Most Respected Company List.

Reddy, who was conferred with the Padma Vibhushan in 2001, is carefully crafting the expansion plans in India. While the healthcare infrastructure gap remains substantial, with only 9 beds per 10,000 population which is significantly lower than the global median of 30 beds per 10,000 population. Apollo is trying to reduce the gap by adding more beds in the new markets and strengthening its current occupancy levels in the existing markets.

Apollo Hospitals Enterprises standalone revenue for the fourth quarter of financial year 2017 came in at Rs 1,662 crore, registering 14.8 percent year-on-year (y-o-y) increase. This was primarily driven by 22 per cent and 9.5 per cent y-o-y growth in the revenue of pharmacy and healthcare services, respectively.

Ebitda for the quarter fell by 6.6 per cent y-o-y to Rs 170 crore. Ebitda margin for the quarter stood at 10.2 per cent. This margin contraction was mainly led by 147.3 per cent y-o-y jump in cost of material consumed. The profit after tax for the quarter came in at Rs 48.2 crore, y-o-y decline of 38.9 per cent.

Considering the whole year numbers, we see that revenue for FY17 rose 15.3 per cent y-o-y to Rs 6,442 crore while Ebitda during the period increased 4 per cent y-o-y to Rs 774 crore.  However, the company reported net profit of Rs 285 crore, down 15 per cent y-o-y.

In tier-1 cities, the group has 4,565 operational beds (5,127 capacity beds) and it plans to add 980 beds by FY19. Out of 2,340 operational beds (2,757 capacity beds) in tier-2 cities, it plans to add 65 beds by FY17.

On the clinical front, the group is trying to set benchmark standards in clinical outcomes, technology and practices in select acute and tertiary care services — cardiology, oncology, neurosciences and more. In addition, Apollo will expand its oncology presence both through specialisation and exclusive oncology referral hospitals in the new 200-bed cancer referral centre under construction in Chennai.

Apollo is addressing the country’s healthcare issues. For example, India’s share in global disease burden is 20 per cent, while its share of healthcare infrastructure is much lower with only 6 per cent of global hospital beds and 8 per cent share of doctors and nursing. Through its initiative, Apollo is focused on identifying, training and retaining some of the best talents in the country.

Apollo Hospitals has been at the forefront of new medical breakthroughs.

The group is harnessing clinical data of patients generated from various verticals and businesses to integrate them together for better clinical outcomes. The data — ranging from medical history, medicine, treatment, and lifestyle and diet history will play a pivotal role in predictive analysis and preventive healthcare.