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Shalby Hospitals in talks to take control of two hospitals in Delhi, Kolkata for Rs 250 crore

14 January, 2019 12:48 PM
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Shalby Hospitals in talks to take control of two hospitals in Delhi, Kolkata for Rs 250 crore

The Delhi hospital has a 150 bed capacity, while Kolkata is a 200 bedded hospital.

Shalby Hospitals, which is on an expansion spree is in talks to take over two hospitals in Delhi and Kolkata at an estimated cost of around Rs 250 crore.

The Delhi hospital has a 150-bed capacity, while Kolkata is a 200-bedded hospital.

“We typically go for the 150-200-bed hospital; we don’t go for very large hospitals. We cater to the patients surrounding 5-7 kilometres, people these days don’t like travelling,� said Dr Vikram Shah, CMD of Shalby.

These two hospitals are in addition to the Rs 160-crore capital expansion undertaken by the Ahmedabad-headquartered hospital chain to add 538 beds.

Part of this expansion plan includes setting up multi-speciality hospitals in Nashik and Vadodara with a total capacity of 263 beds.

Rest of the additional beds will come from two hospitals in Mumbai that the company plans to take over.

In the first one, the healthcare provider has taken over operations and management (O&M) of 50-bedded Zynova Hospital in Ghatkopar, Mumbai, and is adding another 100 beds to make it a 150-bed hospital.

Shalby also entered into an agreement to takeover O&M of 110-bedded Asha Parekh Hospital in Santacruz, Mumbai which was shut down in February last year due to losses. Shalby is further expanding Asha Parekh Hospital by adding 65 beds.

Shalby started by Shah, an orthopaedic surgeon in 1994, has emerged as a market leader in joint replacement surgeries in India, with around 15 percent share among private hospitals, according to Frost & Sullivan.

Around three-fourths of its Rs 3,923 revenue in FY18, came from joint replacement surgeries. The rest from other specialities such as cardiology, neurology, oncology, bariatrics, liver and renal transplant.

Shalby mainly operates in western and central India. The company operates dozens of outpatient clinics in India, Africa and UAE to feed its hospitals.

At present, Shalby has a network of 11 hospitals with 2012 bed capacity, of which around 50 percent are operational.

Eighty percent of its overall revenue and close to 100 percent of EBITDA came from four mature hospitals Vijay Shalby, SG Shalby and Krishna Shalby in Ahmedabad and Shalby Vapi.

Shah said the hospital chain will be going for one more round of fundraising this year. The promoters will be diluting 10 percent stake through a qualified institutional placement (QIP)

“We have to do another dilution in a year’s time because we have not done 25 percent dilution as planned. We have done only 17-18 percent,� Shah said.

The promoters of Shalby led by Shah, his family members and associates hold around 79.41 percent stake. The company has a market capitalisation of Rs 1,570 crore as on January 14.

Shah said the government decision to cap the prices of knee implants actually helped them, as more people were able to get knee replacement surgeries with prices coming down.


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