Manipal Health to make Delhi debut to strengthen presence

Cementing its foray into northern India, Manipal Health Enterprises (MHE), the healthcare arm of the Manipal Education and Medical Group, will acquire a hospital in New Delhi in the next few weeks, said MHE Executive Chairman Swami Swaminathan.

Swaminathan said that the company has been talks with a few potential acquirees and, with the Delhi hospital under its belt, is expecting to add 200-250 beds to its roster. As part of its expansion in Delhi, the company plans to invest Rs 250 crore over the next two quarters in its operations in the city.

“We are also looking at expanding in under-served areas where our medical expertise and experience will come of use, especially in states like Odisha. We are not ruling out public-private partnerships (PPPs),” Swaminathan said.

MHE’s expansion into the northern and eastern regions alone will involve investments of Rs 500 crore of which Rs 300 crore will be invested in the next six months, he said. By 2017, the company, which operates 15 hospitals with around 5,000 beds in India and abroad, plans to add 3,000 beds through the acquisition route. Of this, 1,000-1,250 beds will be toted up by MHE’s overseas healthcare operations.

While also deepening its focus on emerging markets in the Middle East, Africa and ASEAN, MHE has been looking to foray into newer locations like Delhi and Odisha. 

"In the Middle East, we are particularly keen on UAE, Oman and Qatar where we will look at the possibility of working in PPP mode. As for India, we are in conversations with at least 6-8 hospitals to explore acquisitions," said Swaminathan. “In Bangalore we will continue to expand with more neighbourhood clinics – about 20 clinics are planned in the next 12-18 months. And, homecare is a growing sector with strong social relevance, which we are looking to address with specialised staff and facilities.”

In the last three years, the company has gained access to approximately $200 million from its pool of investors, who include Kotak, IDFC and India Value Fund Advisors (IVFA). In 2012, it had raised $180 million (Rs 1,118 crore) from private equity firm IVFA.

“We have committed a bulk of these funds into different expansion-related projects,” Swaminathan said. “Both greenfield and inorganic options are open to us.”

In Bangalore, MHE has completed work on two greenfield projects of 300 beds each in Whitefield and Hebbal. The 120-bed hospital in Goa has been revamped at a cost of Rs 100 crore, and is expected to have 200 beds after the current phase of expansion, he said. 

The third largest hospital chain in the country after Apollo Hospitals and Fortis Healthcare, MHE has close to 2,000 doctors on its rolls. “In the next 3-4 years, we are set to double the total medical workforce, including doctors, nursing and support staff, keeping in pace with our expansion,” Swaminathan said.

Bangalore-based MHE had last month acquired the 280-bed S K Soni Hospital based in Jaipur, which is one of Rajasthan's largest private multi-specialty hospitals with super specialisations in comprehensive cancer care, neurosurgery, joint replacement and cardiology.

MHE acquired a 72-bed hospital in Malaysia last August which it plans to eventually expand to 200 beds. Also in the pipeline is a 200-bed hospital at Klang in Kuala Lumpur which will be operational by February next year. Besides, MHE invested Rs 40 crore for a majority stake in men's fertility venture Ankur Healthcare last year.

Last year, healthcare and life sciences emerged as the second favourite destination for venture capital after technology, with clinics and specialised hospital chains accounting for 15 of the 27 investments.