Medicover Hospitals targets to expand with Rs.1,000 crore

Hyderabad-based Medicover Hospitals have undertaken a massive expansion program. With an investment of Rs 1,000 crore, it will add another 3,000 super specialty medical beds in the next three years, said Dr. G. Anil Krishna Vella, CMD, Medicover Group of Hospitals

In August 2017, Medicover, a leading provider of medical services in Europe, purchased a majority stake in local MaxCure Hospitals, renamed it Medicover Hospitals. Before COVID (March 2020), Medicover Hospitals had 2,500 beds in Telangana, Andhra Pradesh and Maharashtra combined, adding another 2,000 beds with an investment of Rs 700 crore over a year and now operating 20 hospitals with a capacity of 4,500 beds, it employs 10,400 people.

Medicover Hospitals is planning to set up another 10 hospitals (with an additional 3,000 beds) with an average of 300 beds, thereby increasing the total number of beds to 7,500. Half of the investment comes from internal resources and equity investment. The other half is some of the debt from the banks. Some more are collected as foreign trade loans (ECBs). Dr. Anil Krishna said the expansion was targeted to be completed by 2024. Medicover, a Swedish company, currently owns 61 percent of the company. Medicover is ready to provide some capital funding for the proposed expansion. As a result, Medicover Hospitals foreign equity stake is likely to grow further.

“We will start a new 300-bed hospital that will be opened in Navi Mumbai next month”, as Dr. Anil Krishna informed. It costs Rs. 100 crores, and he said a new hospital would be set up in Warangal in the next two years and two more hospitals would be set up in Hyderabad. Medicover Hospitals earned revenue of Rs 750 crore in the 2020 calendar year. Revenue is expected to touch Rs 1,100 crore this year. Next year, Rs. 1600 - 1800 crore revenue is likely to be recorded, he revealed. Expansion to metro cities like Bangalore, Chennai, Pune will increase revenue as the number of beds increases. He added that the growth would add another 5,000 employees to the expansion of new hospitals.

Any idea of going for a public issue (IPO)? Replying to a question, he said that it was not yet the case, adding that the proposed expansion would be completed in the next three years and then an IPO would be considered. He said there were plans to expand the range of diagnostic and pharma services. He said there were plans to enter the pharmaceutical and retail sectors. He said the priority was being given to specialized hospitals for cancer and maternal medicine.

'The third installment in the form of Omicron, COVID-19, responds to the threat of drowning, saying that the vaccine will protect against it. It has been suggested that under the current circumstances, it is advisable to take a third dose vaccine under the booster, even if the two-dose vaccine is completed. Dr. Anil Krishna said that with the experience encountered with the Delta variant, the government had directed them to set up their oxygen plants in hospitals with more than 200 beds. He said an oxygen plant was being set up at the Visakhapatnam hospital.