You are here: Home » Companies » News
Business Standard

SRL Diagnostics to enter CIS, Africa

The diagnostics market in India is estimated at $2.5-3 bin

Reghu Balakrishnan  |  Mumbai 

SRL Diagnostics, the healthcare arm of Fortis, is eyeing expansion into fast-growing markets of Africa and CIS countries. SRL, which has about 40 per cent share of the organised diagnostic market in India, plans to open labs and collection centres countries such as Congo, Kenya and Nigeria in Africa. It is also looking at tie-ups in CIS countries.

The diagnostics market in India is estimated at $2.5-3 billion.

SRL, with revenue growing 20 per cent year-on-year for FY13 (???), has 5,300 collection points and 270 labs across 500 cities, covering around half of the country’s districts. It is expected to clock revenue of Rs 750 crore for 2013-14.

SRL recently tied up with a local promoter, which will make the investment, in the Democratic Republic of Congo to operate and run five diagnostic labs (radiology and lab medicine).

The annual revenue for the clinical diagnostic sector in East Africa is estimated to be $80 million in 2009, expected to grow at 12.4 per cent compounded annually to $183 million by 2016. Given the scarcity of high-end diagnostics in the CIS countries, Sanjeev Vashishta, chief executive, said the company sees significant opportunity there.

Pathology makes up 79 per cent of SRL’s business, radiology 16 per cent and wellness (preventive health check) and CT Testing five per cent.

“At the moment, the company has a capacity utilisation of a little over 50 per cent. Expansion of reach through opening more collection points and introducing new tests would help in filling the capacity at a little cost,” Vashishta said. In 2010, SRL acquired Piramal Diagnostics for Rs 600 crore to become the largest diagnostics company in India. Founded by billionaire brothers Malvinder and Shivinder Singh, it saw a change in ownership when Fortis Healthcare (controlled by the Singh brothers) took 74.59 per cent for Rs 803 crore in 2011.

Through pre-IPO placements, Avigo Capital Partners picked up 9.27% in SRL for about Rs 100 crore while Sabre Partners invested Rs 50 crore to acquire about four%. Logos Holding, Prime Trust and Religare Group hold the remaining stake.

"Unfortunately, the diagnostics industry in India is not regulated at the moment. It is the hour of the need if we want to provide quality services to the masses. Good quality diagnosis will help in accurate prognosis and early and effective treatment. The government should look at making accreditation mandatory for the diagnostic service providers," Vashishta said.

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Wed, January 15 2014. 00:41 IST