to increase the capacity in the years to come,” the filing said.
“Manipal plans to add 1,200 beds in international locations to leverage on the Manipal brand name. The targeted countries initially are Malaysia, Middle East and South Africa. Post expansion, approximately 20% of revenue would be from international markets as per the company,” the JPMorgan report said.
The key focus markets for growth will be Pune, Indore, Bhubaneswar and also Rajasthan and the national capital region. The company also plans to upgrade some of its existing facilities into multi-speciality hospitals. The company plans to fund the expansion through a mix of equity, debt and internal accruals. According to JPMorgan, it plans to invest Rs 30 crore to open another 10 IVF clinics over next two to three years.
Narayana Hrudayalaya (NH), which like Fortis and Apollo Hospitals has a pan-India presence and operates 17 hospitals with 6,380 beds, has six subsidiaries with hospitals in Malaysia and the Cayman Islands. The company plans to become a 30,000-bed chain through 17 new hospitals in the next five to seven years, which would require a capital investment of Rs 1,000 crore, funded by a mix of equity, debt and internal accruals, according to JPMorgan.
The group is looking to expand to Tier-II and III towns in Maharashtra, Gujarat and Uttar Pradesh. “Plans to ramp up NH’s presence in East Africa countries such as Kenya, Tanzania and Zambia are also in the works,” said the JPMorgan analysts. The company usually constructs a 300-bed hospital in Tier-II/III cities and average capex per bed is Rs 25 lakh as opposed to the industry average of Rs 35-60 lakh — savings which later translates to lower prices for patients.
“In NH Mysore, heart surgery can be performed for $800 vs $1,000 in NH Bangalore and the company is trying to bring it down further to $500,” the report added.