Apollo Hospitals to increase capacity by 25%

Company gets nod to raise Rs 750 crore through rights issue

Apollo Hospitals Enterprise Ltd (AHEL), one of the leading hospital chains in the country, is planning to increase its capacity by around 25%. Currently, the hospital chain has 9,215 beds. 

In a letter to the shareholders, AHEL's Executive Chairman Prathap C Reddy said Apollo will add another 800 beds across three new hospitals in the coming year. 

The company said it has already got approval to raise up to Rs 750 crore through an equity rights issue.

“The purpose of the rights issue is to ensure we have the capital we need to pursue opportunities for future growth, while simultaneously rewarding our shareholders by providing them an opportunity to grow further with the company,” said Reddy.

In 2014-15, AHEL commissioned five new hospitals. It created additional capacity of 1,300 beds in the last 24 months. 

Reddy said Apollo is also strengthening its retail healthcare footprint, which apart from retail pharmacies, now includes primary clinics, sugar clinics, birthing centres, day surgery centres and dental clinics. The Nova centres which Apollo acquired recently will also work as short stay surgical centres. 

“We believe that we have the potential to secure a meaningful market share in the retail health care space as well,” he added.

On the standalone pharmacy business, Reddy said it continued to reported over 30% in revenues on a year-on-year basis. EBITDA grew at a similar pace at about 29% for the year and ended the year with an EBITDA margin of 3.3%. 

“The Hetero acquisition has now been completed and will be fully integrated by the first quarter of the coming financial year,” said Reddy.