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Apollo Hospitals eyes smaller acquisitions
Healthcare major Apollo Hospitals on Wednesday said it wants to switch to an asset-light model which will focus on taking facilities on contracts and may go for smaller acquisitions of up to Rs 300 crore.
Mumbai: Healthcare major Apollo Hospitals on Wednesday said it wants to switch to an asset-light model which will focus on taking facilities on contracts and may go for smaller acquisitions of up to Rs 300 crore.
The company also hinted at going slow on investments from here, saying extracting benefits from past bets will be the focus now through margin expansion. The over three-decade-old company, which was in the news for issues with excess share pledging by the promoters and also stake sales in units including its insurance JV and the pharmacy business runs 72 hospitals at present.
"We are not looking to sell more stakes and will be doing smaller, bolt-in acquisitions of up to Rs 300 crore from now," its Managing Director Suneeta Reddy told reporters here.
She said it has invested Rs 3,000 crore in the last 30 months at a time when very few were investing and added that the focus now will be on profit growth through "reaping in" the investments by improving utilisation levels. Its chairman Prathap C Reddy also said that there is "no desperation for money".
The company's debt stood at Rs 3,200 crore as of June. Suneeta, his daughter, said the company will be adopting an 'asset-light' model from here, which will focus more on taking up hospitals for operational management.
The chairman said a similar model is followed in the hospitality industry and also hospitals abroad, where the asset owner is different from one who runs the enterprise.
Suneeta said the company is looking at acquisitions like the one in Lucknow which it did for reaching out to a newer geography.
