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Revenue for Q1 FY24 of INR 4,607 Million, a growth of 13% (y-o-y)
EBITDA for Q1 FY24 of INR 743 Million, a growth of 5% (y-o-y)Bengaluru, August 16, 2023: HealthCare Global Enterprises Limited (“HCG”), the leader in India in specialty healthcare services focused on oncology and fertility today announced its financial results for the quarter (“Q1”) ended June 2023.
Acquisition Update – Nagpur
- About HCG NCHRI
- HCG NCHRI LLP operates and manages 115 bedded hospital in Nagpur, providing comprehensive cancer care services under medical services agreement
- Revenue from operations of HCG NCHRI LLP for the financial year ended March 31, 2023, was INR 51.4 Crores
About the Transaction
- The company entered into Share Purchase agreement with shareholders of NCHRI; Dr Ajay Mehta & Dr Suchitra Mehta for acquisition of Shares in NCHRI
- The company also entered into Partnership Transfer Agreement with Dr Ajay Mehta in HCG NCHRI Oncology LLP to acquire his partnership interest
With this acquisition of NCHRI and HCG NCHRI LLP, the Company can entirely consolidate the business operations in Nagpur, and this would result in a better financial and operating structure
- SRJ CBCC Hospital, Indore
Asset Overview
- Indore based Comprehensive Cancer Care (CCC) hospital
- 50 beds facility offering Medical, Surgical and Radiation oncology
- First & #1 Comprehensive Cancer Center in private space in Indore
- To acquire 100% of hospital on a slump sale basis
Strategic Rationale
- New Market Entry: Entering a key non-metro city with a quality asset & HCG brand
- Attractive market dynamics: Suitable market dynamics with no large non-charitable hospital
- present for Oncology
- Attractive market: Oncology market estimated to grow at 15-20% CAGR
- Capacity Expansion: Capacity expansion by 100 beds at a nearby location, estimated to be
- operational in 2 years
- Potential levers for increasing scale: Launch of Organ specific practice, LINAC addition, serving new patient channels
- Potential levers to improve margins: Operational efficiencies & Synergies
Highlights for quarter ended June 30th, 2023
- Consolidated Income from Operations (“Revenue”) was INR 4,607 mn as compared to INR 4,081 mn in the corresponding quarter of the previous year, reflecting a year-on-year growth of 13.0%
- Consolidated Profit Before Depreciation and Amortization, Finance Costs, Exceptional Items and Taxes (“EBITDA”) was INR 743 mn, as compared to INR 706 mn in the corresponding quarter of the previous year, a growth of 5% year-on-year
- EBITDA for Existing centers was INR 761 mn, a growth of 2% year-on-year
- EBITDA from New centers was INR 99 mn, as compared to INR 108 mn in the corresponding quarter of the previous year
- Consolidated Profit after Taxes and Minority Interest (“PAT”) was a profit of INR 76 mn, as compared to INR 61 mn in the corresponding quarter of the previous year, a growth of 26%
INR million except earnings per share
| Period ended Mar’23 | Q1-FY24 | Q1-FY23 | Growth (y-o-y) |
|||||
| Income from Operations | 4,607 | 4081 | 13% | |||||
| EBITDA(1) | 743 | 706 | 5% | |||||
| EBITDA margin (%) | 16.1% | 17.3% | ||||||
| EBITDA (Excl. ESOP) (2) | 764 | 725 | 5% | |||||
| Ad. EBITDA margin (%) | 16.6% | 17.8% | ||||||
| PBT (3) | 105 | 104 | – | |||||
| PAT (4) | 76 | 61 | 26% | |||||
| PAT margin % | 1.7% | 1.5% | ||||||
| Earnings per share (EPS) | 0.55 | 0.44 | 25% | |||||
(1) Profit before depreciation and amortization, finance costs, exceptional items and taxes
(2) EBITDA excluding other income & ESOP
(3) Profit / (Loss) before tax and after share of profit / (loss) of equity accounted investee, exceptional items
(4) Profit / (Loss) for the period after share of profit / (loss) of equity accounted investee, taxes and minority interests, exceptional items
Business Updates for Q1 FY24
- Overall ARPOB stood at Rs. 39,686 vs. Rs. 38,286 in Q1 FY23
- Overall AOR stood at 66.9% vs. 61.0% in Q1 FY23, a rise of 590 bps
- RoCE (Q1FY24 Annualized)
o RoCE for Mature centers stood at 20.2% vs. 19.0% in Q1FY23, an improvement of 120 bps. RoCE pre-corporate allocations stands at 24.5%
o RoCE for Emerging centers stood at -5.0% vs. -4.6% in Q1FY23. RoCE pre-corporate allocations stands at -2.0%
- Several regions delivered high double-digit revenue growth on yearly basis
o Markets like Kolkatta and Rajkot grew by 54% and 51% YoY respectively
o Ranchi, Jaipur & Nagpur grew by 27%, 22% and 18% YoY respectively
o Our International operations grew at a robust growth rate of 108% YoY
Commenting on the results, Dr. B.S. Ajaikumar, Executive Chairman, HealthCare Global Enterprises Ltd.
said,
“HCG’s oncology network, through its presence and depth, uniquely positions the company to address the growing cancer burden in India holistically, while delivering quality cancer care and outcomes.
HCG’s role today goes beyond mere service provision, extending into pioneering research and academia. We consistently encourage our medical professionals to delve into research, clinical trials, and active participation in global medical conferences and academic pursuits. We are currently working on the low dose immunotherapy & also collaborating with various MNC’s for developing technologies and AI based framework for treatments.
HCG strives to be the trusted healthcare partner for every individual battling cancer. We are honored to have earned the trust of our patients and the communities we serve and remain committed to upholding that trust every day”
Mr. Raj Gore, CEO HealthCare Global Enterprises Ltd., added, “During the first quarter of fiscal year 2024, our revenues witnessed a 13% year-on-year growth, reaching Rs. 461 crores. Additionally, our EBIDTA (excluding ESOP) amounted to Rs. 76.4 crores.
We are delighted to share that we have initiated our journey of expansion through inorganic means, successfully completing the acquisition of two centers situated in Indore and Nagpur. These strategically significant locations and assets are poised to serve as a strong foundation for our oncology practice, positioning us to emerge as prominent players in these markets in the forthcoming years.
Our strategic approach involves a gradual and meticulous augmentation of both capacity and capabilities, thoughtfully timed to facilitate scalability and bolstered profitability through the harmonization of synergies and operational efficiencies. With HCG’s profound domain knowledge, technological expertise, and clinical prowess, we are dedicated to furthering our mission.
With growing oncology disease burden, the inherent strengths and future outlook of the HCG model is best suited to provide superior outcomes for patients while sustainably achieving the desired objectives of all stakeholders, over the coming years.”