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Narayana Healthcare eyes 24% growth

NH presently has about 6,000 beds across 17 hospitals present in 13 locations

Antonita Madonna  |  Bangalore 

Dr Devi Shetty
Dr Devi Shetty

Dr Devi Shetty's Narayana Healthcare (NH) expects to record a revenue growth of 24-27 per cent in the present year, slightly lower than its annual average of about 30 per cent to 35 per cent. NH expects to end the present fiscal year with revenues of about Rs 1,200 crore, according to its CEO and Managing Director Dr Ashutosh Raghuvanshi.

However, the hospital chain expects to jump back into the 30 - 35 per cent growth range during fiscal 2015 when it will begin raising more revenues from its new operations.

"We hope for a 32 per cent growth next year as many of the units will be in a stabilisation phase," says Raghuvanshi.

"During fiscal 2015, we will also see all the units we established in the last two years in an operationally-mature stage and we expect that to boost the numbers."

Raghuvanshi says the hospital chain plans to add seven new centres in the coming fiscal to its existing base of hospitals across the country. NH had plans to add 10 new healthcare centres in fiscal 2014 and follows an alternate year strategy of expansion and stabilisation.

However the chain will add more than the usual number of new centres in fiscal 2015 as most of the revenue growth comes from the new hospitals.

"From our existing operations we see a growth of about 10-12 percent increase in revenue year on year, but massive spurts of growth come in from the new units," Raghuvanshi said.

NH presently has about 6,000 beds across 17 hospitals present in 13 locations within the country. Known for its treatment of cardiac care, the company which recently hived off its dental care unit to focus on its is now working on an aggressive expansion of its cancer care facilities. It is setting up 6 new healthcare centres dedicated to cancer care in Mysore, Shimoga, Jaipur, Ahmedabad, Kolkata and Raipur. It already runs a centre in Bangalore.

"We have seen the the need for cancer treatment in India is very large but the supply is not adequate to take care of that demand. Hence the gap is very large and there is a great opportunity to fill," Raghuvanshi said.

"Besides, cancer care is very expensive, including the infrastructure required to set it up. However, we are using technology to bridge that and it is not a very difficult proposition. Besides, when you get more treatments done, economies of scale are also achieved," he adds.

Besides Bangalore, Narayana Health has hospitals in Hubli, Dharwad, Kolar, Hyderabad, Kolkata, Jamshedpur, Raipur, Jaipur and Ahmedabad in addition to international subsidiaries in Malaysia and Cayman Islands. It is exploring options to expand in Africa as well.

Despite talk of key investors JPM and PineBridge (AIG) which control about one-fourth of the company attempting to increase a stake in the firm, Raghuvanshi maintained that there has been no change in the ownership pattern.

"They (JPM and PineBridge) are at 22 per cent and with a some other stakeholders constitute 25 per cent. However, it is still 75 per cent owned by family," Raghuvanshi says. "However, we still work very closely with our stakeholders to frame policies and take strategic decisions and there has been no need for additional capital requirement yet."

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First Published: Wed, January 08 2014. 20:36 IST