Apollo Health and Lifestyle (AHLL), a wholly owned subsidiary of Apollo Hospitals Group, has acquired Nova Specialty Hospitals in an estimated ₹145-crore deal, a move that would give the Pratap Reddy-founded company entry into Mumbai, Jaipur and Kanpur.

Debt, equity funding With this acquisition, Apollo now gets 350 beds spread over eight cities where Nova Speciality Hospitals has a presence.

The funds for this acquisition will be raised by Apollo through a mix of debt and equity, company officials said.

Further, the combined entity is expected to post revenues of ₹115-125 crore in this financial year, company officials said.

These moves form a part of the overall strategy of the Pratap Reddy-promoted company to achieve revenues of ₹2,000 crore by 2020, with 1,000 centres. “We are seeing a trend wherein the average length of stay for a patient is coming down from 4.5 days a few years back to about 32 hours,” said Sangita Reddy, Joint Managing Director, Apollo Hospital Enterprises.

Neeraj Garg, CEO, Apollo Health, added that the company is aiming to create a business of ₹500 crore in five years and this acquisition is in line with that.

The Apollo Hospitals’ scrip ended 3 per cent lower at ₹1096.80 in a weak market on the BSE on Tuesday.

In fiscal 2014, Apollo has treated two million patients, according to company officials but with this acquisition and through use of modern technology, the company is confident of addressing more patients.

According to analysts, the healthcare industry in India is expected to reach $160 billion by 2017.

Of this, the day care surgery market (which involves a surgery to be performed within a day’s time) is expected to grow to ₹500 crore by 2020.

Currently, 60 per cent of surgeries done are day procedures with the remaining 40 per cent involving short-stays, according to Apollo executives.

Related Topics
comment COMMENT NOW