Kerala-based Meditrina Hospitals scouts for PE funds

Matrix Partners-backed Meditrina Hospitals, run by globally acclaimed interventional cardiologist Prathap Kumar, is looking for new investors to upgrade and expand cath labs that are operated through public private partnerships.

Kumar pioneered setting up cath labs through PPP (public private partnership) model.

Kollam-based Meditrina Hospitals is the third largest in terms of angioplasties done annually in the country. It has cath labs in Kerala, Haryana, Jharkhand, Telangana and Maldives. These facilities have a total of 600 beds.

"Global PE major Matrix Partners owns 34 per cent since the past five years. I am not averse to selling some of my personal holding to a financial investor. The funds will be used to expand the PPP model cath labs across the country," Kumar, CMD of the group, told PTI from Kollam.

Kumar and his family own 64 per cent in Meditrina Hospitals set up in 2009 and 2 per cent shareholding is with celebrated Italian cardiologist Imad Sheiban who was his professor and mentor.

Amid coronavirus pandemic, it expects to close FY21 with a marginal growth in turnover at Rs 170 crore, up from Rs 150 crore in FY20.

With more than 1 lakh angioplasty procedures conducted annually, Meditrina is the third largest after Apollo and Fortis, Kumar said.

He also claimed that his facility charges only Rs 56,000 for a surgery, which is cheaper than the rate of Rs 75,000 under the central government's Ayushman Bharat scheme.

Kumar, who is a votary of PPP model, said that as against an annual demand for 1 crore cardiac surgeries, hospitals can undertake only around 7 lakh angioplasties now.

Each cath lab costs around Rs 8 crore and to set up one on a standalone basis, the cost would be at least Rs 100 crore, Kumar said.

According to him, the biggest saving is that he does not invest in the building and the infrastructure, except the medical equipment. Also, overall salaries are lower with a doctor getting around Rs 3 lakh a month, he added.

He has a DM degree in cardiology from the Turin University Hospital, Italy.

With COVID-19 pandemic realigning hospital cost structure, experts feel healthcare chains, which bet on low-cost and with potential to scale up, will attract money.

"PPP models in cardiology are gaining popularity because of their lower cost. While PPP model has the potential to attract PE funds, their scalability and sustainability will be the key for investment-driver," Mahesh Singhi, founder of Mumbai-based investment bank Singhi Advisors, said.