Chennai-based MGM Healthcare has chalked out a multi-pronged growth and expansion strategy. The multi-specialty hospital is planning to aggressively ramp up its bed capacity, expand its presence in neighboring states besides foraying into dedicated oncology care and preventive healthcare space.
“By 2024, we will have about 1,000 beds in Chennai and surrounding markets. We are planning to develop another 3,000 beds across Andhra Pradesh, Telangana and Karnataka. Overall, our aim is to develop 4,000 beds by 2025-26 across these four southern states,” Prashanth Rajagopalan, Director, MGM Healthcare told BusinessLine.
Currently, MGM Healthcare has a 400-bedded quaternary care multi-specialty hospital in the heart of Chennai. The facility has 50 out-patient consultation rooms, over 100 critical care beds, more than 250 doctors and 12 Centers of Excellence.
Rajagopalan said that the expansion will be a mix of green field and brown field projects. While the current facility is fully owned by MGM Healthcare, going forward, it will move into an asset-light model, wherein it will take buildings or land on a lease or co-develop them with promoters to keep its cost low.
MGM Healthcare is in the process of launching a 200-bedded Oncology hospital closer to the current facility in Chennai. Built at an estimated cost of ₹120 crore, the new facility will be a dedicated cancer care centre offering medical, surgical, radiation oncology, diagnostic oncology as well as lab facilities. It is expected to be launched in the next 3-4 months.
Rajagopalan said that there is a huge gap in the market for quality cancer care at an affordable price point and the new hospital is aimed at bridging that.
“On one side, we have volume-based cancer care but they don’t offer personalised care and on the other, we have western approach of highly personalised cancer care but those are not affordable by everyone,” said Rajagopalan.
MGM Healthcare will also foray into the preventive healthcare space, riding on the growing demand for preventive healthcare since the onset of the Covid-19 pandemic. The healthcare player will set up several small format, day care hospitals to take preventive health closer to the local community. MGM Healthcare is planning to have about 100 such day care centres by 2024-25.
“We may have a handful of large MGM Healthcare hospitals but a significant portion of the activity will happen in the preventive space with heavy thrust on diagnostics and early intervention. That will be one of our growth routes over the next couple of years,” Rajagopalan said.
On funding for current expansion, Rajagopalan said, it will mostly be a mix of internal accruals and bank debts but the healthcare provider is certainly not looking at private equity (PE) route. He, however, added that the healthcare provider may go for a fundraise by 2024-25.