Hospital Market in India Hospital Market in India July 2013
Mar 06, 2016
Hospital Market in IndiaHospital Market in India
July 2013
Executive Summary
Market Overview
The hospital market in India was valued at INR x2 tn in 20‐‐ and is expected to reach INR x5 tn by 20‐‐ The sector is divided primarily into public and private along with NGO operated hospitals Constantly rising population results in perennial shortage of hospital beds
Drivers &
Drivers:Shortage in Number of Hospital Beds Increasing Lifestyle Diseases
Challenges: Shortage of Medical Professionals Lack of Investment in IT Infrastructure
Drivers & Challenges
Surge in Medical Tourism Government Initiatives Propelling InvestmentGrowing Target Hospitalization Population Group
Shortage of FDI Inflow in Indian Hospitals
GroupGrowing Health Insurance Market Rising Disposable Income
Specialty ClinicsGlocal Healthcare Systems
Hospital Mobile ApplicationsHospital Information Centre
Luxury Offerings Diversified Business ApproachKey Trends
Competitive
Glocal Healthcare Systems Hospital Information Centre Diversified Business Approach
Key Players
Apollo Hospitals Enterprise Ltd. Fortis Healthcare (India) Ltd. Care Hospitals Pvt. Ltd.
y
2HOSPITAL MARKET IN INDIA 2013.PPT
Landscape Columbia Asia Hospital Pvt. Ltd.
Manipal Health Enterprises Pvt. Ltd.
Max Healthcare Institute Ltd.
•Economic Indicators•Indian Healthcare Scenario •Introduction•Introduction•Market Overview•Drivers & Challenges•IT Adoption•Role of Government •Key Trends•Key Trends•Key Initiatives•Competitive Landscape•Trade Fairs & Events•Recent Transactions•Strategic Insights
3
Strategic Insights•Appendix
HOSPITAL MARKET IN INDIA 2013.PPT
SAMPLE Economic Indicators (1/3)
INR tn
15d4c4d3
3
Gross Domestic Product At Factor Cost (At Constant Prices): Quarterly
14
13
12
11
b4
a4
c3b3
a3
d2c2b2
a2
d1c1b1
a1
10
Q4Q3Q2Q120‐‐ ‐ ‐‐20‐‐ ‐ ‐‐20‐‐ ‐ ‐‐20‐‐ ‐ ‐‐
Inflation Rate: Monthly
N.B.: New Series Base : 2004‐05
y
0 8
1.0
%
ECB
0.2
0.4
0.6
0.8
DA
4
0.0
Mar 20‐‐ ‐ Apr 20‐‐Feb 20‐‐ ‐Mar 20‐‐Jan 20‐‐ ‐ Feb 20‐‐Dec 20‐‐ ‐ Jan 20‐‐Nov 20‐‐ ‐ Dec 20‐‐
HOSPITAL MARKET IN INDIA 2013.PPT
Healthcare system in India requires a larger public outlay due to huge population base Healthcare Industry Overview
• According to “World Health Statistics 2011 Report, India”,
healthcare comprised of r% of India’s GDP in 20‐‐ Public and private expenditure on health as percentage of GDP
Healthcare Sector – Market Size & Growth
8 000
10,000
INR bn
A%f
ed Public and private expenditure on health as percentage of GDP
was r1% and r2% respectively
• Favorable demographics, increase in awareness levels
and better medical care are some factors that are driving
healthcare sector in India 0
2,000
4,000
6,000
8,000 dc
ba
healthcare sector in India
• Hospital forms the largest segment of overall healthcare
market followed by pharmaceutical, medical devices,
health insurance and diagnostics
G d l t ti f h lth i i t i
0
2017e2016e2015e2014e2013e2012
Healthcare Market Segmentation – 20‐‐ ‐ ‐‐
•Gradual penetration of health insurance is stepping up
affordability of health services through increased demand
for preventive and curative healthcare services
• Superior quality healthcare coupled with low treatment a%d%e%
f%
c%cost in comparison to other countries is benefiting Indian
medical tourism, thereby steering forth Indian healthcare
market Treatment for major surgeries in India costs approximately m%
b%
c%
A EC
5
of that in developed countries B FD
HOSPITAL MARKET IN INDIA 2013.PPT
SAMPLE FDI Inflow in Indian Healthcare Segments
Several healthcare segments in India have earned good volume of FDI over a 12 years’ span between 20‐‐ to 20‐‐
INR m bnHospital and diagnostic centers INR m1 bnHospital and diagnostic centers
INR m2 bnMedical and surgical appliances
INR m3 bnDrugs and pharmaceuticals sector
6HOSPITAL MARKET IN INDIA 2013.PPT
Hospitals can be classified on grounds of ownership and clinical operation
Classification of Hospitals
Ownership Basis Clinical Basis
Public Hospitals
Run by Central Government,State Government and local bodies
General Hospitals
Hospitals staffed by at least two medical officers that provides in‐patient
accommodation and medical care for more than one category of medical discipline
PrivateHospitals
Run by Central Government,State Government and local bodies
Specialized Hospitals
Provides medical attention for one discipline and is administratively attached to a general
hospital
IsolationH it l
Hospitals for the care of persons suffering from i f ti di
Corporate Hospitals
Public limited companies formed under Companies Act run commercially and is likely
t t h i f h it l
Hospitals infectious diseases
Tertiary Hospitals
State and Central government hospitals established in their state capitals
pto operate chain of hospitals
Voluntary Functions with public or private funds on a
TeachingHospitals
A hospital to which a college is attached for medical/dental education
Rural Located in rural areas permanently staffed by at least one physician that provides in‐patient
7
Voluntary Hospitals
Functions with public or private funds on a non‐commercial basis Hospitals accommodation and medical care for more
than one category of medical discipline
HOSPITAL MARKET IN INDIA 2013.PPT
Hospitals is the most crucial aspect of Indian healthcare sector, constantly developing to provide world class service
•Hospitals are a major component of the Indian Healthcare industry forming more than a% of the total healthcare sector’s revenue
Market Overview (1/2) Market Size and Growth – Private HospitalsINR tn
6x7healthcare sector s revenue
•Hospital sector is divided into public and private There are ~p private hospitals and ~q public hospitals across the country
• Potential growth prospect of Indian healthcare is attracting many foreign companies who are willing to
5
4
3
+X% x6
x5x4
x3x2attracting many foreign companies who are willing to
invest or establish base in India There is a growing trend to tap the high potential tier II and tier III cities A trend of growth in specialty and multi specialty hospitals in the country is also observed
2
1
0
20‐‐e20‐‐e20‐‐e20‐‐e20‐‐e20‐‐
x2
20‐‐
x1
in the country is also observed 20 e20 e20 e20 e20 e2020
• Primary Healthcare facilities acts as the backbone of public healthcare system established and operated primarily by government institutions with low involvement of private
• Based on approach of universality, comprehensiveness and equity in health, the country lags behind in terms of standardization of processes, quality and service
Key Healthcare Delivery Formats
• Secondary Care Hospitals that may or may not specialize in treatment of a specific ailment but offers most essential services
• In most cases it caters to 85% to 90% of medical requirements• The segment consists of district and all other privately run general private hospitals
• Tertiary Care Hospitals are specialized which offer specific facilities and employ highly
8
specialized practitioners who also offer specialized consultative care• Service is provided by private, regional or central level institutions such as multi specialty and single specialty hospitals
HOSPITAL MARKET IN INDIA 2013.PPT
Drivers & Challenges – Summary
Drivers
Shortage in Number of Hospital BedsShortage in Number of Hospital Beds
Increasing Lifestyle DiseasesChallenges
Surge in Medical Tourism
Government Initiatives Propelling Investment
G i T H i li i
Shortage of Medical Professionals
Lack of Investment in IT Infrastructure
Growing Target Hospitalization Population Group
Growing Health Insurance Market
Shortage of FDI Inflow in Indian Hospitals
Rising Disposable Income
9HOSPITAL MARKET IN INDIA 2013.PPT
Huge demand‐supply gap for hospital beds is the potent driving element of the hospital market
• India faces an acute shortage in number of hospital beds in comparison to population level of the country
Shortage in Number of Hospital Beds Impact
According to World Health Statistics, India is positioned among the lowest countries on a global perspective with which is far below the global average of s beds per t population
According to National Health Profile 20‐‐, India has a public sector availability of one bed per f population in g government hospitals which is only h beds per i population
• Public sector as well as private sector needs to pull up the number of hospitals and other p p p phealthcare institutions as population growth will raise demand for more hospital beds By 20‐‐, population size will be d mn that will necessitate e mn beds to achieve High Level Expert Group (HLEG) target of i beds per j population
Hospital Beds Per 1,000 Population – 2010
UK o
USA n
Japan m
Rural Urban Hospital Bed Ratio Comparison
s
Rural India Public Hospital Bed Ratio
Rural India is characterized by public hospitals while Urban
India by private hospitals
Brazil s
China r
Sri Lanka q
Russia p
UK o
u
c
Private Hospital Bed Ratio
India by private hospitals
10HOSPITAL MARKET IN INDIA 2013.PPT
India u
Thailand t Developed Nations
Emerging Nations Urban IndiaSouthern IndiaCentral India
Lack of foreign investments acts as an impediment to the hospital market of the country
ImpactShortage of FDI Inflow in Indian Hospitals• Indian hospitals is lagging behind in acquiring sufficient share of FDI FDI equity inflow in hospital sector is far low even when compared to drugs and pharmaceutical sector in India
FDI investment in hospital & diagnostic centers ranks ard in terms of amount of FDI equity inflows in period between Apr 20‐‐ to Jan 20‐‐
• There are both internal and external issues that decelerate foreign investments in our country
Hospital & Diagnostic CentersINR n bn ~ b%
Internal Issues
High cost involvement in hospital establishment
Depreciation of medical equipments
Imbalance in FDI Investment Within Healthcare Sector
Drugs & PharmaceuticalsINR m bn ~ a%
INR n bn b% Depreciation of medical equipments
Feasibility issue in upgrading healthcare equipments
External IssuesINR m bn a%
Indian private hospitals unable to establish hospitals overseas
Requirement of in‐depth localized knowledge of host country
11HOSPITAL MARKET IN INDIA 2013.PPT
g y
Indian government fails to provide a clarity in policies on overall healthcare sector
SAMPLE IT Adoption in Hospital is progressing slow with only high end corporate hospitals…
35
40
INR bn
18.3%
u
t
IT Spending on Healthcare
10
15
20
25
30
p
18.3% ts
rq
0
5
10
20‐‐ 20‐‐e20‐‐e20‐‐e20‐‐e20‐‐e
m%•Business streamlining and patient administration systems is the prime motive for IT adoption in hospitals H it l id b tt d t
n%
•Hospitals can provide better care and manage costs better internally and patients can look for lower healthcare costs
• IT leveraging and sharing data on cloud helps in saving i f t t d t t t t
12
IT Adoption in Hospitals
IT Adoption in Other Healthcare Segments
infrastructure and manpower to a great extent
HOSPITAL MARKET IN INDIA 2013.PPT
SAMPLERole of Government: Summary SAMPLE Budgetary Allocation
Role of
Government
Financial IncentivesPublic Private PartnershipsFinancial Incentives Partnerships
(PPPs)
13HOSPITAL MARKET IN INDIA 2013.PPT
SAMPLEKey Trends SAMPLE Specialty
Diversified Business
Clinics
Glocal HealthcareDiversified Business Approach
Glocal Healthcare Systems
KeyTrends
Luxury Offerings
Hospital Mobile Applications
Trends
Hospital Information Centre
14HOSPITAL MARKET IN INDIA 2013.PPT
SAMPLE Key Initiatives – Summary
Health Cities
KeyInitiatives
Telemedicine Mobile HospitalsTelemedicine Mobile Hospitals
15HOSPITAL MARKET IN INDIA 2013.PPT
‘Health Cities’ are gradually being popularized to cater mostly to medical tourists
•Health Cities primarily include super specialty hospital attached to a medical college, residential area with in‐house high end diagnostic centers, commercial zones and other common infrastructure
H l h Ci i•Health Cities cater to larger populations by offering additional facilities such as hotels, recreational facilities such as spa, gym and even golf courses
• They are also expected to lay a greater emphasis on education and R&D
Health Cities
Narayana Hrudayalaya
• As on May 20‐‐, the group aims to build s bed health
cities that will offer medical care facilities in heart
Odisha State Government
• As on Jul 20‐‐, the state government is planning to set up an integrated health city on the outskirts of Bhubaneshwarcities that will offer medical care facilities in heart,
kidney and cancer
• One city each is planned in Jaipur and West Bengal,
while two shall come up on the outskirts of Kolkata
• As on Dec 20‐‐, the group is in plans to initiate a
Bhubaneshwar• Concept note of the project has been prepared by Industrial Infrastructure Development Corporation of Odisha
• Project is aimed at making the state a complete health destination and promote medical tourismAs on Dec 20 , the group is in plans to initiate a
centre in Lucknow, UP with a bed capacity of m‐n
beds
health destination and promote medical tourism• The government would promote the project on public private partnership with one or two mega healthcare promoters as anchors of the proposed city
• QRG Enterprises announced its plan of penetrating healthcare segment with hospital chain in NCR along with Ludhiana, Agra and Jaipur as
16HOSPITAL MARKET IN INDIA 2013.PPT
Q G te p ses a ou ced ts p a o pe et at g ea t ca e seg e t t osp ta c a C a o g t ud a a, g a a d Ja pu ason Jun 20‐‐
• The group plans to set up a p‐bedded super‐specialty facility in Faridabad that is expected to be commissioned in Sep 20‐‐ with an investment of INR d bn that would be named ‘QRG Health City’
Competitive Benchmarking (2/5)
Key Ratios of Top 3 Companies – Operational Basis (FY 20‐‐) (1/3)
40
% Net MarginOperating MarginGross Margin
10
20
30
40
c3b3
c2b2
a2
c1b1
a1
0
CB
c2
A
• A recorded gross margin of a1%, higher than B which recorded gross margin of a2%
• A recorded an operating margin of b1%, higher than both B and C that recorded an operating margin of b2% and b3% respectively
• A recorded a net margin of c1, higher than both B and C that recorded net margin of c2 and c3 respectively
17HOSPITAL MARKET IN INDIA 2013.PPT
Major Public Companies ‐ Summary
500,000,000
Net Profit(INR mn)
100 000 000
200,000,000
300,000,000
400,000,000 Size of bubble represents Market Capitalization in INR mn
‐200,000,000
‐100,000,000
0
100,000,000
ba
‐500,000,000
‐400,000,000
‐300,000,000
‐700,000,000
‐600,000,000
15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000 55,000 60,000 65,000 70,000
Revenue(INR mn)
18
BA
HOSPITAL MARKET IN INDIA 2013.PPT
Private: Domestic Company – Player A (1/5)
Company Information Offices and Centres – India
Corporate Address xx
Tel No. xx
Website xx
Year of Incorporation xx
Delhi
Head OfficeProducts and Services
Category Products/Services
Key People
N D i ti
Category Products/Services
Sports Goods xx
Fitness Equipment xx
Name Designation
Equipment Supplier xx
Others xx
19HOSPITAL MARKET IN INDIA 2013.PPT
Private: Domestic Company – Player A (2/5)
Shareholders of the Company as on xx/xx/20‐‐ Ownership Structure
Name No. of Shares held
100 0%100 0%100 0%
Directors or relatives of directors
100.0%100.0%100.0%
Total
20‐‐20‐‐20‐‐
20HOSPITAL MARKET IN INDIA 2013.PPT
Ownership structure corresponds to Date of AGM: xx/xx/20‐‐, xx/xx/20‐‐ and xx/xx/20‐‐
i i l S h K i
Private: Domestic Company – Player A (3/5)
Financial Snapshot Key Ratios
Particulars y‐o‐y change (20‐‐ ‐ ‐‐)
20‐‐ 20‐‐ 20‐‐ 20‐‐
Profitability RatiosOperating Margin N.A. N.A. N.A. N.A. N.A.
Net Profit/LossTotal IncomeINR mnINR mn
nNet Margin N.A. N.A. N.A. N.A. N.A.
Profit Before Tax Margin N.A. N.A. N.A. N.A. N.A.
Return on Equity 1.47 5.36% 3.89% 0.00% 0.00%
Return on Capital Employed 0.00 0.00% 0.00% 0.00% 0.00%
Return on Working Capital 0.00 0.00% 0.00% 0.00% 0.00%
Return on Assets 0.00 0.00% 0.00% 0.00% 0.00%
m
Financial Summary
Return on Fixed Assets 0.00 0.00% 0.00% 0.00% 0.00%
Cost RatiosOperating costs (% of Sales) N.A. N.A. N.A. N.A. N.A.
Administration costs (% of Sales)
N.A. N.A. N.A. N.A. N.A.
Interest costs (% of Sales) N A N A N A N A N A
0
20‐‐20‐‐
• Company earned a net profit of INR m units in FY 20‐‐, as compared to net profit of INR n units in FY 20‐‐
• It reported total income of INR p units in FY 20‐‐, registering an increase of t per cent from FY 20‐‐
Interest costs (% of Sales) N.A. N.A. N.A. N.A. N.A.
Liquidity RatiosCurrent Ratio ‐10.83% 1.76 1.97 1.71 2.07
Cash Ratio ‐35.86% 0.16 0.24 0.20 0.32
Leverage RatiosDebt to Equity Ratio 14.21% 1.16 1.02 0.50 0.50
• The company reported a debt to equity ratio of x percentage points in FY 20‐‐, an increase of y per cent over FY 20‐‐
Debt to Capital Ratio 6.57% 0.54 0.50 0.33 0.34
Interest Coverage Ratio N.A. N.A. N.A. N.A. N.A.
Efficiency RatiosFixed Asset Turnover N.A. 0.00 0.00 0.00 0.00
Asset Turnover N.A. 0.00 0.00 0.00 0.00
Current Asset Turnover N.A. 0.00 0.00 0.00 0.00
21
Improved Decline
Current Asset Turnover N.A. 0.00 0.00 0.00 0.00
Working Capital Turnover N.A. 0.00 0.00 0.00 0.00
Capital Employed Turnover N.A. 0.00 0.00 0.00 0.00
HOSPITAL MARKET IN INDIA 2013.PPT
Private: Domestic Company – Player A (4/5)
Business Highlights
Description News
Overview • xx
Facilities • xx
22HOSPITAL MARKET IN INDIA 2013.PPT
Public: Domestic Company – SWOT Analysis – Player A (5/5)
XX• XX
• XX
O
WS
TO
• XX• XX
23HOSPITAL MARKET IN INDIA 2013.PPT
Thank you for the attentionHospital Market – India report is part of Research on India’s Healthcare Industry Series.For any queries or customized research requirements, contact us at:
Ph 91 22 4098 7600
Follow us on:
Phone: +91 22 4098 7600E‐Mail: [email protected]
About Netscribes, Inc.Netscribes, Inc. is a knowledge‐consulting and solutions firm with clientele across the globe. The company’s expertise spans areas of , g g f g p y p p finvestment & business research, business & corporate intelligence, content‐management services, and knowledge‐software services. At its core lies a true value proposition that draws upon a vast knowledge base. Netscribes, Inc. is a one‐stop shop designed to fulfil clients’ profitability and growth objectives.
Disclaimer: This report is published for general information only Although high standards have been used in the preparation “Netscribes” is
24
Disclaimer: This report is published for general information only. Although high standards have been used in the preparation, Netscribes is not responsible for any loss or damage arising from use of this document. This document is the sole property of Netscribes and prior permission is required for guidelines on reproduction.
HOSPITAL MARKET IN INDIA 2013.PPT