IHH eyes 20% growth in India through acquisitions, expansion of facilities

The hospital chain said it is committed to participating in bid for Fortis and extended the validity of its offer by a fortnight till May 29

Malaysian hospital chain IHH Healthcare Berhad is targeting 20-30 per cent annual revenue growth in India through acquisitions, expansion of current facilities and introduction of new specialties.

IHH, which first entered India in 2002, is expanding its footprint through inorganic route and is now in the fray to acquire Fortis Healthcare.

On Friday, the hospital chain said it is committed to participate in bid for Fortis and extended the validity of its offer by a fortnight till May 29.

“We have already done three deals in India and there are more in the pipeline. However, it is not appropriate for me to talk on Fortis,” said Dr Ajay Bakshi, India CEO of Parkway Pantai, an IHH group company.

The Malaysian chain has declared India as one of its core markets and aims to grow its revenue significantly here. Currently, it runs seven hospitals in south and west India with 1,600 beds. Indian business contributed Rs 12 billion in revenue which was around 6 per cent of total in 2017.

“Whether this deal (Fortis) or some other deal that our managing director Tan See Leng has announced, we are actively looking for acquisitions with India,” he said.

Bakshi expects Indian business revenue to grow 20-30 per cent annually irrespective of whether the company acquires stake in Fortis.

IHH's first hospital in India was set up in Kolkata in 2002  through its joint venture with Apollo Hospital. But, the company largely remained a passive investor till 2015 when it acquired 51 per cent stake in Continental Hospitals in Hyderabad and later 73.4 per cent stake in Global Hospitals.

Bakshi, who earlier held leadership roles in Manipal Hospitals and Max Healthcare, said the company plans to add 400-500 beds at existing facilities in Chennai, Mumbai and Bengaluru as it expects occupancy level to rise from 65 to 75 per cent. The hospital chain will also be expanding its specialties offering anti-cancer and neurological treatment at its hospitals.

JOURNEY SO FAR

• IHH entered India in 2002 and set up JV with Apollo Hospitals. The JV runs a hospital in Kolkata
• India is one of its core markets and company acquired majority stakes in Continental and Global Hospitals in 2015
• Runs 7 hospitals in India and operates 1600 beds
• Aims to grow revenue 20-30 per cent. Looking at inorganic growth opportunities