Kerala doc’s Gulf-returned medical empire

When Azad Moopen went to Dubai in 1987, he wanted to accomplish two things — earn enough to build a palatial house and then bring back a ‘foreign’ car. A general physician, Moopen had been teaching at the Government Medical College, Kozhikode when he decided to take a five-year sabbatical. “I had gone to Dubai earlier in 1986, as part of a philanthropic mission to collect funds to build a mosque in my hometown in Kerala,” he recounts. A senior from his college, who was practising in the Emirate, had convinced Moopen to move to Dubai for a career opportunity. “There was an option in the medical college to take leave without losing seniority. I took it, intending to return after five years,” says Moopen.

But he didn’t return. What started as his private clinic in 1987 gradually ballooned into one of the largest healthcare groups in West Asia and India. The clinics, pharmacies and hospitals in Moopen’s holding company, Aster DM Healthcare, generated an estimated $890 million in revenues this year. He is a regular on Forbes’s rich list, which valued the 62-year-old doctor-turned-entrepreneur’s wealth at $1.1 billion in 2015.

“Looking back, the learning is that you might start trying to do something, but God pushes you in a different direction. When destiny knocks, you shouldn’t complain of noise pollution,” the good doctor wisecracks, seated at his office in Kozhikode’s Malabar Institute of Medical Sciences (MIMS). Long before crowd-funding caught on as an idea, Moopen used it to build the ₹60-crore hospital in 2001 and later became its majority shareholder.

Born to an affluent family in Kalpakanchery, in Kerala’s Malappuram district, a young Moopen was inspired by his father’s important standing in their village. A wealthy landlord, Ahmed Unni Moopen was a freedom fighter and philanthropist who had helped build the local hospital, school and post office. “People, including policemen, came to him to solve problems. I learnt decision-making from him,” says the son, who became a student leader in college and successfully campaigned against the government’s move to accord MBBS degree to homeopathy doctors.

Moopen Sr had been particular about two things — his youngest son must read Mathrubhoomi and The Hindu every morning; and he had to excel in mathematics. He should have all the makings of an entrepreneur, in effect. However, the decision to become a doctor had been an emotional one. The youngest of five brothers and two sisters, Moopen was barely 15 when his father passed away. He knew that his father had always wanted one of his children to become a doctor.

“He used to like the medical profession as one of my brothers-in-law was a doctor,” Moopen remembers. After obtaining his MD degree from Calicut Medical College, he became a lecturer there in 1982.

When destiny knocked, even Moopen Sr would have been pleased with the turn his son’s medical career took towards entrepreneurship.

In Dubai, Moopen’s desire to return home to his first love — teaching — waned as the years rolled by. His wife Nazeera and three daughters — Alisha, Ziham and Zeba — also wanted to stay back. As his clinic grew increasingly busy, the doctor’s business instincts took over. “Business was in my blood. So I started opening more clinics,” he says.

Circumstances conspired to favour him. At the turn of the 21st century, Dubai’s economy was booming. Flush with oil money, the Emirate’s rulers embarked on a flurry of construction, promoting Dubai as a tourism destination. Architectural marvels such as the Burj Khalifa (the world’s tallest structure) and the Jumeirah Palm (largest manmade island) brought travellers and investors in hordes. Professionals from across the globe arrived to take up lucrative jobs.

Moopen’s business model proved hugely successful. Each of his clinics had a pharmacy, and they fed each other’s growth. As his clientele grew — Moopen himself saw up to 100 patients a day — he quickly realised the need for a professional to run the business.

“I was the first non-family member when I joined the company in 1998,” says TJ Wilson, Executive Director of Aster DM Healthcare.

Among the clinics Moopen was adding to his chain were a few bought from relatives. “A relative based in London was struggling to manage his clinic in Dubai. So we bought it,” says Wilson, who also heads the group’s governance and corporate affairs. “As Dubai boomed and new neighbourhoods came up, we replicated our clinic-pharmacy model in more locations.”

Moopen sensed his next big opportunity in Kozhikode. It was the 1990s, and patients in this coastal city travelled all the way to Chennai and Coimbatore in search of quality treatment. “We decided to fill the gap,” he says simply. His network of friends and relatives helped raise the money. Nearly 40 of them came forward with contributions ranging from ₹50 lakh to ₹1 crore each. Not only did Moopen get to spread his risks, the coming together of likeminded investors also made the hospital a community project.

He got another crucial factor right. “Azad picked the best of young and middle-aged doctors from India and abroad, including many from England and the US, for the hospital,” says KK Varma, the group’s chief medical officer, medical director of MIMS, and also Moopen’s former teacher. “He bypassed the local, entrenched doctors. This helped because the young doctors he hired had the hunger to do well. They needed to grow, and for that the hospital had to grow. It was a smart move from Moopen,” adds the paediatrician-surgeon and former principal of the Government Medical College, Kozhikode.

By 2005, Moopen’s healthcare business had grown so big that he no longer had time to practise medicine. He would soon joke that his wife asks their children and grandchildren to consult other doctors when needed, as her husband has lost touch. Around this time the group had spread outside Dubai to the rest of UAE, and beyond to other parts of West Asia, including Qatar and Oman.

His ambitions could no longer be bankrolled by just friends and relatives. In 2008, Moopen raised money from India Value Fund Advisors (IVFA). The fund house invested in Aster DM Healthcare’s equity once again in 2011. The following year it partly diluted its stake to Olympus Capital, which also bought primary shares in a $100-million investment.

Suffused with capital, Moopen opened even more clinics and hospitals in India and West Asia, and acquired a few too. Interestingly, in India, Moopen has desisted from opening pharmacies, even as peers such as Apollo have been bullish in the segment. “The margins are very low here,” he reasons. Moreover, bulk purchases were not profitable as “there are many agents between the manufacturer and the retailers”.

The group gets its highest margins from hospitals (nearly 25 per cent), with the clinics up next (about 15 per cent) and the pharmacies bringing up the rear (below 10 per cent). At 300 properties, Aster DM Healthcare has everything from budget clinics to super-premium hospitals, including Medcity in Kochi, which opened in May 2015.

The pace of expansion is worryingly reminiscent of other ventures that have lost steam eventually. Wilson admits there is pressure from the private equity investors, but also reiterates that the group is sitting pretty on a favourable debt-equity ratio.

Moopen is in no mood to stop, having set a Vision 2025 statement for his business. Additionally, he has ventured into the education sector — apart from a medical college in Wayanad, his family has invested in a chain of nursery schools — Toddler Town British Nursery — run by his second daughter, Ziham.

Twenty-nine years after shifting to Dubai, Moopen certainly has a lot more than one palatial house and a big car, and that includes a recently added Maybach. Those close to him swear by his humility. He carries his bag to office and has lunch with everyone else in the staff canteen (even if his table, unlike others’, is covered by a clean cloth). Some see this endearing side as part of a well-cultivated personality, one that helps in networking.

But the man himself is clear about the legacy he wants to leave behind, as also how to sustain it. “I don’t want to be seen as a moneybag. That demoralises me. I want to be known as a doctor, a family man and a philanthropist,” says the tycoon, who has dedicated 20 per cent of his wealth to philanthropy. “I want to divide my wealth equally into five parts. I have a wife and three children. The fifth part will be for the people who require it. So 20 per cent of the wealth will go to charity.”

The Chairman and Managing Director wishes to retire in five years and take up a non-executive role. He equally wishes to separate business from family. “Separation of the management and ownership is the best; otherwise, inefficiencies creep into the system,” he says. This might sound contradictory when you consider that two of his daughters are involved in the business.

The eldest, Alisha, is a chartered accountant and handles the group’s West Asian operations. The youngest, Zeba, has just completed her medical course and is deciding between joining the group’s management and healthcare segments.

Moopen, however, is in no doubt. Aster DM Healthcare Group, which also has plans for an initial public offering, will be board-driven and run by professional CEOs. While there’s nothing new in this, few first-time entrepreneurs have actually been able to remain hands-off from their babies. Dr Moopen’s papa skills will be called in on this one.

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