Ameera Shah, the CEO of Metropolis Healthcare, one of the top three diagnostic chains in the country, shares her overseas and domestic expansion plans with FE?s Soma Das. She feels point of care technology can tap the un-addressed rural markets in future.

Metropolis was in talks to acquire one of the largest path lab chains in South African market. What is the update on that?

We were in discussions to acquire one of the path lab business in South Africa to consolidate our position in the market but the deal fell through. We are, however, forging ahead with our plans to consolidate market share there. Unlike in India, where majority of the healthcare expenditure happens out of pocket, South Africa is a mature market where health insurance is the major financier for the diagnostic services and the patient doesn?t have to shell out for healthcare expenses. We are targeting a significant market share of this insured segment of population. South Africa is also a very interesting market as the path lab market there is witnessing a situation of oligopoly where the top three lab chains dominate the whole market unlike in India where the market is acutely fragmented.

So it is one of these top three players that Metropolis was keen to acquire…

That of course is a probability. I cannot comment on the matter.

Which are the other geographies where Metropolis is hunting for similar opportunities?

The nature of opportunity could vary from one geography to the other, but overall some of the other African markets such as Kenya, Tanzania, Ethiopia and Nigeria are markets of interest to us. Again in West Africa, Iran and Bahrain, among other markets, look promising. That, however, doesn?t mean that we would enter each of these markets in immediate future. What it means is that we would be on the look out for a suitable opportunity.

What about your expansion plans in the Indian market?

We would be adding 15 to 20 labs annually for the next three-four years, which would entail an yearly investment of around R20 crore, and close to 100 collection centres per annum. This would add to our existing 55 labs in the domestic market. We are upbeat about the domestic market, where the branded organised path lab chains are growing at around 30% on a yearly basis. There is also a lot of latent demand that remains untapped. Doctors and consumers are getting aware about brands and the face of the market would change in next six-seven years as insurance penetration deepens.

What about the bottom of the pyramid ? the rural and smaller urban centres where the branded path labs are yet to register their presence?

The path labs haven?t gone there because there are not enough hospitals and doctors to prescribe tests there, so building a viable business case becomes difficult for us. Having said that, I think we need out of box thinking and completely different models to tap that market, just like the banking sector did with microfinancing. I think point of care technology where we can take malaria, TB testing kits to rural homes can go a long way to address this market.

Will point of care technology cannibalise your business when it makes its full presence felt here?

To some extent yes, in urban centres, with glucometers and BP machines flooding the market. But that is inevitable and inconsequential. The benefits it may provide in tapping smaller centres will far outweigh the other aspects.