The Hindu Business Line : Narayana Hrudayalaya makes investment plans

Hyderabad, Nov. 10 Setting its targets big, the Bangalore-based Narayana Hrudayala Hospitals plans to bring in around Rs 5,000 crore investments in the next five years to create a total 30,000-bed strength hospital chain.

The mission is to provide low cost, affordable healthcare with the best available technology across the country, said Dr Devi Shetty, founder Chairman of the Group.

Narayana Hrudayalaya, which has the reputation of having the world’s largest cardiac care hospitals in Bangalore, has plans to establish ‘health cities’, at Kolkata, Jaipur, Ahmedabad, Jamshedpur, Bhubaneswar and Hyderabad in the next 5 years with a strength of 5,000 beds each, he told newspersons here today.

While most of these health cities are with the support of the respective State Governments, Narayana Hrudayalaya is venturing into a project in Hyderabad, with private participation for the first time.

It has joined hands with the Malla Reddy Education Group to set up the Narayana Hrudayalaya Malla Reddy Health City. The latter has offered 40 acres and also its 500-bed hospital to be managed and expanded over the next 3-5 years into a 5,000-bed facility.

In addition to cardiac surgeries at affordable costs, especially for children, the Hyderabad health city will offer artificial heart implant also. The cost of an artificial heart (made by an Australian company), is Rs 50 lakh at present.

Narayana Hrudayalaya Institute of Cardiac Sciences, which has the licence to install it, will do the first implant in Hyderabad free of cost, Dr Shetty said. “We already do the implant in Bangalore,” he added.

In the initial phase about Rs 200 crore would be invested in the venture.

About 60 per cent of the treatment would be for adult cardiac surgery and balance for paediatric. While Narayana Hrudayalaya will manage the entire medical care, the nitty-gritty of the agreement has not been worked out, he said.

The typical break even cost of a cardiac surgery at present is Rs 65,000. “We are able to offer it at a lower cost by procuring consumables, diagnostics, equipment in large volume, which forces companies to offer huge discounts. Also surgeons do many more surgeries per day compared to corporate hospitals,” Dr Shetty explained.

The next big effort is to bring it down to Rs 45,000. It would be possible, when the bed strength reaches 20,000. Narayana Hrudayalaya is a profitable venture and its investors include AIG, JP Morgan and Ms Kiran Mazumdar Shaw of Biocon.

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