Apollo Hospitals to add over 2,000 beds in next three-year expansion plan

Company plans speciality beds for cardiology & cancer, will expand to new cities

After crossing a target of 10,000 beds capacity, Apollo Hospitals is gearing for the next stage of an expansion plan that would see an addition of around 2,000 beds. The hospital chain is in the final stage of its current three-year expansion plan, which targeted to add 2,500 beds.

"I think Apollo doesn't sleep. It works round the clock and we are completing the three-year plan of adding 2,500 beds now, which will be completed with the proton centre. But we will have another three-year plan. We need more beds because of the huge problem of NCDs (non-communicable diseases)," said Prathap C Reddy, executive chairman, Apollo Hospitals Group.

In the next stage, the company would have speciality beds for cardiology and cancer, would expand to other cities where it does not have the presence and also to increase the beds in cities where it is already present in, he said.

"Investment for the present expansion is completely covered. When it comes for the next expansion, people are willing to give us money, they trust us," added Reddy. He was speaking on the sidelines of launching Apollo Memory and Apollo Headache and Migraine Clinics, set up in its hospital in Chennai.

The company, in the 36 months ending March 31, 2017, has commissioned 2,430 beds in 13 locations including a 480-bed facility in Navi Mumbai. During the financial year (FY) 2018-19, the Navi Mumbai facility is expected to see an expansion into oncology apart from the addition of 65 beds in Indore hospital and a proton therapy centre to treat cancer with 200 beds in South Chennai. Besides, the current expansion plan is to add another 500 bed in a hospital in Byculla, Mumbai, for Rs 350 crore in FY22.

The company has 70 hospitals with a total bed capacity of 10,084 beds at the end of FY17, of which 43 hospitals with 8,362 beds are owned by the company, including joint ventures, subsidiaries and associates.

Of the 8,362 owned beds capacity, 6,997 beds were operational and had an occupancy of 64 per cent till Q4FY17, according to a company document. It has 11-day care or short surgical stay centres with 229 beds and nine birth centres under the brand Cradle with 259 beds. It also manages seven hospitals with 1,234 beds.

Earlier, the company management has said that with the completion of the current stage of expansion, it would look at consolidating the operations in the existing business with a focus on increasing the occupancy during this year. The hospital has recently said that it has an occupancy of 47 per cent and the plans are to increase the occupancy to 65 per cent by the end of the current FY.

With continuous expansion going on for years, it has been seeing pressure on the margin. The consolidation is also expected to ease the margin pressure, improving the profitability of the company, said officials earlier.