Apollo Hospitals may float Proton Cancer Centre as special purpose vehicle

Apollo Hospitals Enterprise (AHEL) is looking at bringing a long-term investor for its Apollo Proton Cancer Centre, the only such facility in the country.

The thinking is to form a Special Purpose Vehicle (SPV) on the Centre, “for which we are in a very advanced stage,” said A Krishnan, chief financial officer,” of getting an investor, a long-term, 10-year, one.” He was speaking to analysts at an earnings call conference.

The firm is also targeting to grow its oncology business to Rs 2,000 crore annually (it was Rs 850 crore in 2018-19) over the next four to five years. “We will have a better picture in the next 30 days,” added Krishnan. “We will have joint control from our side and it will not be consolidated in the profit and loss statement of Apollo. It will have debt taken into their books from our books. 

Strategically, this (step) will help us to have an opportunity to bring in other strategic investors, if it is required.  It can probably also be a platform that can be looked at in future, to see what else can be added.” 

The company says the therapy in question is a sophisticated form of radiation, using high-energy protons to target tumours accurately, while greatly reducing the radiation dosage to surrounding healthy tissues. The precision allows it to preserve vital structures at the tumour site, giving various benefits to the patient. 

One of the latter advantages is reduced side effects and enhanced quality of life for a patient during and after treatment. It can address various cancers.

The company announced plans to set up the Centre in collaboration with Belgian firm Ipon Beam Applications in 2013, with an expected investment of Rs 400 crore. Later, it expanded the plan to add a 150-bed hospital along with the centre, in Chennai. The Centre was launched this January and the hospital will be ready by the end of this year. The facility is expected to be ramped up in a phased manner and will see an investment of at least Rs 200 crore in this financial year. 

AHEL is also expanding its oncology offerings, with three more centres to its existing six. “Our effort will also be to show India as a preferred destination globally for oncology," said Suneeta Reddy, managing director of AHEL, to the analysts.