Tag: Max Healthcare

Occupancy levels normalising at 70-73%; Max Lab seeing traction in non-COVID biz: Max Healthcare

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Abhay Soi, CMD, Max Healthcare, on Thursday, said that occupancy levels are normalising at around 70-73 percent. He also mentioned that occupancies in some hospitals are in fact beyond 80 percent. Additionally, he explained that elective surgeries saw a reduction due to Omicron wave.

“In January, when the Omicron wave came in, we didn’t see too many hospitalizations, but we saw a reduction in elective surgeries. So the occupancies that come down to 60 percent. Since the fear of Omicron has subsided, the numbers have gone up and as we speak, we are at about 70-73 percent occupancy levels. Things seem to be easing back to normalcy,” he said.

On Max Lab, he shared that the segment is seeing traction in non-COVID business.

“As far as Max Lab is concerned, we’ve been doubling down in this business. We’ve added more and more channel partners, about 40 percent in the last two quarters alone. As COVID-19 businesses came down, we’ve seen a massive buildup as far as the non-COVID business is concerned. So it is seeing very good traction. In the last two quarters, to a base of 440 channel partners, we have added another 260,” he said.

Also Read: Here’s how to create the 14-digit unique Ayushman Bharat Health Account number

On its home care segment, Soi said that the business is now profitable.

“We started home care business about five years ago, and we got 650 people doing this business; it’s amongst the largest, if not the largest home care business in the country as we speak and yet perhaps, the only profitable one,” he said.

On acquisitions, he said that they announced 4 of them. Max Healthcare is looking to double its capacity in 4 years and for this purpose, the company will use less than 50 percent of its internal accruals.

“All of these acquisitions that we have announced over the last six months – that’s for acquisitions, essentially – that along with the two imbedded brownfield projects that we have, should almost double our capacity over the next four years. However, the most interesting part is that we’re going to be using less than 50 percent of our estimated internal accruals over the next four years to fund this entire brownfield, Greenfield build-outs that we are doing. That leaves us with about half of our internal accruals free cash flows, as well as our entire balance sheet,” he explained.

Also Read: Pharmacy biz growing at 20%; will announce investors for Apollo HealthCo by March: Apollo Hospitals

Watch the video for the full interview.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Are hospitals geared up for rising Omicron cases? Experts discuss

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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There’s been a surge in the number of COVID cases in the country. With Omicron and Delta variants spreading rapidly, CNBC-TV18 spoke to Abhay Soi, Chairman & Managing Director, Max Healthcare, and Dr Bhaskara Rao Bollineni, Managing Director, Krishna Institute of Medical Sciences, to get a sense of the on-ground reality and also their preparedness to tackle the growing numbers.

First up, Soi said that the rate of hospitalisation is very low.  He explained that in Delhi, Omicron positive cases in their hospitals have increased from 2 percent to 25 percent in the last two weeks. He noted that Delhi is seeing 25-30 percent of patients testing positive for Omicron.

“In Delhi-NCR about 25-30 percent of patients who are coming are Omicron positive. This number was 2-3 percent just a couple of weeks ago. So we see this inverting very quickly, but the rate of hospitalisation is extremely low,” he said.

Soi mentioned that since the total number of cases are expected to be higher in Omicron, thus hospitalisations may also be higher as a result.

Also Read: People with no travel history infected with Omicron, it means it’s spreading in community: Delhi health minister

On preparedness, he said that the hospitals are better prepared for COVID now. Since resources are finite, Soi said that they need to see the scale of Omicron cases.

On Molnupiravir, he said that he doesn’t see a significant revenue stream from such drugs.

Meanwhile, Bollineni also reiterated Soi’s point that hospitalisation is less but transmission is faster. However, he doesn’t expect it to be as dangerous as COVID first and second wave.

“As a disease, it will definitely spread like other flu or viral diseases, but it’s not going to be that dangerous as we have seen in the first and second wave. However, it doesn’t mean to be careless. We need to be very careful,” he said.

Also Read: COVID-19’s Omicron variant may lead to endemic stage: Maharashtra health official

He believes there’s a need to be vigilant as the long-term effects of the new variant is not known. According to him, the next two weeks will be crucial. He added that the second dose of the vaccination or a booster shot is needed.

“Those who have not taken the second dose (of COVID vaccine), they should take it because prevention is better than cure as next two weeks will be very crucial for the country,” Bollineni said.

Bollineni believes they are well geared up with respect to hospital infrastructure. He explained that out patient department (OPD) treatment with Monoclonal antibodies is working well.

For the entire discussion, watch the video

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Max Healthcare says India biz revenue higher than pre-COVID levels in Q2

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Max Healthcare posted a steady set of Q2 earnings. Revenue has seen a rise both sequentially, and on a year-on-year basis as the non-COVID business appears to have normalised. The company’s quarter-on-quarter (QoQ) gross revenues were up at Rs 1434 crore versus Rs 1385 crore. It had reported gross revenues of Rs 944 crore in the same period a year ago. The company reported a multi-fold jump in its consolidated net profit to Rs 144.65 crore for the quarter ended September 30. It had posted a net profit of Rs 16.65 crore for the corresponding period of the previous fiscal. In an interview with CNBC-TV18, Abhay Soi, CMD, Max Healthcare, shared details of the quarterly performance and the outlook.

He said, “If one were to look at the overall occupancy, while we did 73-74 percent pre-COVID, now it stands at about 75 percent with about 1 percent coming from COVID. So in any measure, this can be looked at as non-COVID. This is, in spite of the fact that international business is only one-third of pre-COVID levels. So that is something to look forward to in the coming quarters.”

He also confirmed that as far as revenue is concerned, the India business, at the end of Q2, was higher than FY19, FY20 levels.

On diagnostic business, Soi said, “Organically if you see, the number of partners, franchisees that we have, we have actually increased them by 25 percent. So we increased our 140 channel partners in the last quarter itself to a base of about 450. So that is a massive sort of investment in the organic part of things but we also looking at inorganic opportunities for consolidation and enhancing this business.”

On digital channels’ contribution to revenue, Soi said, “We have invested in phases and from very low numbers sequentially, it has moved up to about 11 percent of our total revenues and we are seeing significant growth in this.”

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He further mentioned, “What it is enabling us to do at this stage is reaching more and more patients, our patients as well as the first-time patients, more effectively and efficiently; we are able to service their requirements. Right now, it’s at the outpatient department (OPD) stage. So, what it really does is as far as the margins are concerned, it helps us convert these patients to our in-patient department (IPD), which is really where the commercial benefit lies at this stage. So at this point in time, it’s about reach, it is about customer acquisition and less about profitability from the digital channel.”

For the full interview, watch the accompanying video.

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Max Health shares slide over 6% on large deals

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of Max Healthcare Institute fell more than 6 percent on Wednesday to hit an intraday low of Rs 345.35 on series of large deals in the initial trading hours.

At 10:59 am, shares of Max Healthcare Institute were trading 5 percent lower at Rs 349.7. In the past one year, the stock registered a return of 209 percent and it has jumped 150 percent year-to-date.

About 9.2 crore shares or 9.5 percent stake in the company worth Rs 3,231 crore exchanged hands on the NSE at an average of Rs 350.25 per share.

American private equity major KKR was expected to sell 6.5 percent stake in Max Healthcare Institute worth $300 million or Rs 2,220 crore in a block trade.

KKR-affiliate Kayak Investments Holdings is selling as much as 63.47 million shares in Max Healthcare at an indicative price range of Rs 350-369.7 apiece, which implies an over 5 percent discount to Tuesday’s closing price, as per reports.

Also Read | Max Healthcare says hospitals seeing 20% plus ROCE, free cash flows of around Rs 1,100 cr

Promoter Kayak Investments held 47.24 percent stake in the company as of June-end.

HDFC Securities noted that the management commentary reinforces the company’s intent to grow aggressively by additionally employing asset light models of expansion and exploring inorganic opportunities.

The brokerage firm in its report earlier this week raised its target price on the stock to Rs 410 from Rs 365, while maintaining its ‘buy’.

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Max Healthcare says hospitals seeing 20% plus ROCE, free cash flows of around Rs 1,100 cr

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Max Healthcare is on the radar. The stock is up over 2 times since its listing in August 2020. Further, HDFC Securities has also written a note on the company where they see a 95 percent upside potential over the next five years. In an interview with CNBC-TV18, Abhay Soi, chairman and managing director at Max Healthcare, discussed the company’s outlook.

On growth, he said, “Max Healthcare at present is, in a classic sort of growth cycle. Our hospitals, each one of them is doing 20 percent plus ROCE. We are generating alpha amounts of cash throughout this thing and this is without any COVID business at present. We have less than 1 percent revenues coming from COVID. So yes, we are doing free cash flows of close to about Rs 1,100 crore at present run rate.”

Also Read: Max Healthcare plans Rs 1,700 cr capex over next 4 years; aims to be debt-free by Q3FY22

“Going forward, if one were to assume and just for calculation purposes, because I don’t give topline guidance, but if one were to assume a 10 percent growth on topline, then our free cash flows would be increasing materially by about 18-20 percent per year. In the next four to five years, we should be generating through internal accruals alone, close to about Rs 5,000 to 6000 crore and this is on our debt-free balance sheet, I mean, effectively as we speak, my current debt levels are perhaps lower than my last quarter’s EBITDA. So therefore, by next quarter, we should be net debt-free. Going forward over the next 4-5 years, we look at leveraging our balance sheet to 2 times debt to EBITDA, we are looking at another Rs 5,000 to 6000 crore, that is about Rs 10,000 to 11,000 crore of war chest to deploy,” he mentioned.

On increasing capacity, Soi said, “In Gurugram, we will be opening a 500-beds hospital over the next 3-4 years, we should be able to deploy about Rs 3,500 crore over the next 4 to 5 years to double our capacity. All of it is accretive simply because most of it is in the back of our already operating hospitals and brownfields; and our hospitals are operating at about 78 percent occupancy.”

On expansion in diagnostics space, he said, “As far as diagnostic acquisitions are concerned, we are certainly looking at it. When it comes to Delhi NCR which is a population of about 40 million people, we are already the third largest diagnostic chain over there and more importantly, if I was to sort of look at what is the amount of captive business we are doing in terms of economic value, volume, we would be amongst the top three or four players in the country because a lot of what we are speaking about is the retail business.”

On deploying capital, Soi said, “As far as deploying capital is concerned, we are looking to do purely in brownfields and greenfields, and some of the asset light models that we have sort of signed up for. So this is purely in the hospital space and this would essentially mean about 80 percent or 70 percent of our internal accruals alone. So, there is no leverage required for setting this up. So this does not include any M&A in the hospital space that we intend to do.”

For full management commentary, watch the video.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Max Healthcare plans Rs 1,700 cr capex over next 4 years; aims to be debt-free by Q3FY22

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Max Healthcare posted a strong set of Q1 earnings on Tuesday, aided by COVID occupancy, non-COVID recovery as well as vaccinations. Revenue is up 19 percent on a sequential basis and operating EBITDA is at the highest ever for the third consecutive quarter.

The company reported a consolidated net profit of Rs 146.92 crore for the quarter ended June 30, 2021. The company had posted a net loss of Rs 314.25 crore for the corresponding period of the previous fiscal. Consolidated total income of the company stood at Rs 1,026.13 crore for the quarter under consideration. It was at Rs 275.58 crore for the same period a year ago.

“We are proud of the role our doctors and paramedical staff have played in the fight against COVID-19, including accelerating the inoculation drive in the country. Overall, we believe we are well placed to deliver consistent growth by adhering to the highest standard of clinical excellence,” said Abhay Soi, Chairman and MD of Max Healthcare Institute.

On debt reduction plan, he said, “We believe there will be significant debt reduction within this current quarter and hopefully by next quarter, we will be a debt-free company.”

On COVID and non-COVID patients, Soi said, “We saw a huge spike in COVID patients in Q1. 42 percent of our beds were allocated to COVID which saw a 76 percent occupancy, whilst the non-COVID patients accounted for 58 percent of the balance beds, with 84 percent occupancy. The COVID revenues were approximately Rs 320 crore, you add vaccination revenues of another Rs 136 crore so that is where we were as far as the COVID revenues are concerned.”

On capex, Soi said, “Currently we have an operating maintenance capex of about Rs 120 crore a year, we have very little interest cost left, so you will see a huge amount of free cashflows within the year itself. Our capex plans are about Rs 1,500-1,700 crore over the next four years. We intend to use our residual free cashflows as well as our ability to raise debt to look at inorganic growth and acquisitions.”

(With inputs from PTI)

For full management commentary, watch the video.

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3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Top health and legal experts on COVID-19 measures

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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India paves the way for Moderna’s COVID vaccine in the country. Pharma major Cipla gets regulatory approval to import the Moderna vaccine for restricted emergency use in India.

However, the approval is only to import donated vaccines and not for commercial purchase.

Moderna’s vaccine will be the fourth COVID-19 jab to be available in India after Covishield, Covaxin and Sputnik.

A study by Max Healthcare hospitals shows that mortality among hospitalised COVID patients was 40 percent higher during the second wave of the pandemic.

The study also finds that while mortality was higher across age groups during the second wave, the sharpest three-fold increase was seen among the young patients below the age of 45.

The study is based on clinical data from over 14,000 COVID-19 patients admitted during the first wave and over 5,400 during the second wave to Max Hospitals in Delhi-NCR, Mohali, Dehradun, and Bhatinda.

To discuss this study, CNBC-TV18 spoke to Doctor Sandeep Budhiraja, Group Medical Director at Max Healthcare; Dr Jayanthi Shastri, Head – Microbiology of BYL Nair Hospital; Mumbai and Murali Neelakantan, Principal Lawyer at Amicus.

Doctor Jayanthi Shastri’s team has done a first-ever sero-survey on those under 18 in Mumbai city.

On import of Moderna vaccine, Murali Neelakantan said, “It is great if it is a substantial number and it will help the effort of course but we don’t know yet where it will be used, will it be used in only a few hospitals, in a state, in many states, how will we have a process for vigilance, how will we track adverse events following immunization (AEFI) for that, so it adds to complexity but any vaccine is welcome.”

Doctor Shastri on sero-survey, said, “In Mumbai, we have conducted three sero-surveys. The sero-survey III was conducted in the month of March where we saw that sero prevalence was 39.3 percent in the age group below 18 years. So while the second wave was on in April we started pediatric sero-survey specifically trying to see whether how many children were exposed to COVID-19 and we also wanted to stratify by the age and find out which is the age group who have been exposed the maximum.”

“Sero-prevalence is good in the sense this has been done in a healthcare setting so these are the children who have accessed care and they have given their blood samples for other reasons and we have been able to test it for the presences of SARS-CoV-2 antibodies.”

“However, with reference to opening schools, I don’t think this is the parameter which should be used.”

Doctor Sandeep Budhiraja said, “The crux of the study was to see the mortality and try to evaluate as to what could be the potential reasons for higher mortality in wave two as it emerged. We observed a mortality figure of 7.2 percent precisely in wave one and 10.8 which is approximately 11 percent in wave two so it is a 40 percent rise and that is the overall increase in mortality.”

For full interview, watch accompanying video…

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

How much money private hospitals will make from COVID-19 vaccine doses?

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Vaccination is the biggest focus area for countries around the world and India is no different. There are countless edits that have been written laying out what is the ideal way to go about it, how to price it, and how to increase the pace of it.

But the big question is the pricing of the vaccine at private hospitals.

The cost of purchase for hospitals from Serum Institute of India is Rs 600 plus GST of 5 percent, so that is Rs 630. Someone in a top private hospital said that the cost of vaccine plus GST plus storage plus logistics is around Rs 660-670 maximum. Assuming it Rs 100, it makes the total cost for hospitals as Rs 730. The average price charged to an individual is Rs 900 by Max Healthcare,  Rs 850 by Apollo Hospitals and Rs 850 for Fortis.

The profit per jab, which is price charged minus cost, is Rs 170 for Max Healthcare, Rs 120 for Apollo Hospitals, and Rs 120 for Fortis.

In terms of jabs per day, for now, the figures are as follows – 50,000 per day for Max Healthcare, 1.5 lakh for Apollo Hospitals, and 20,000 for Fortis.

Talking about profit per jab for 90 days will give an estimate of the quarterly profit. Max Healthcare is likely to make a profit of Rs 76 crore, Apollo Hospitals – Rs 162 crore, and Fortis – Rs 30 crore.

How many vaccine shots are given in a day at private hospitals

Max Healthcare: Till May 15, it administered 1.43 lakh jabs and can ramp up to 50,000 doses a day.

Apollo Hospitals: It is giving 70,000 jabs a day right now and will rise to 1 lakh jabs a day. It also has the bandwidth to raise the number of doses to 2 lakh a day.

Fortis: It can administer upto 20,000 doses a day.

For COVID-19 live updates, click here

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Healthcare infrastructure need of the hour, says Max Healthcare’s Abay Soi

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Max Healthcare reported the highest-ever operating EBITDA in the fourth quarter of fiscal 2021 with an expansion in margins aided by non-COVID occupancies. Abhay Soi, Chairman and MD, Max Healthcare discuss the earnings as well as the current hospital occupancy picture.

“So far, a lot of the capital has been going towards funding companies for consolidation and less towards creating more healthcare infrastructure and that is the need of the hour,” he said in an interview with CNBC-TV18.

“My view has been that there is more than adequate capital available for investment within the healthcare sector, so is there an opportunity in India across the board whether it is urban cities, tier-II cities, tier-III cities,” he added.

The company is still awaiting clarity as far as the COVID package is concerned from the Reserve Bank of India (RBI) and all the banks.

“It seems that it is going to be perhaps subsidised loans up till 2022 and 2023 which allows you to do medium-term investment but for long-term investments, you require loans for 10-15 years,” he said.

“I don’t see pressure on margins so to say because the international business had only come back to 60 percent of pre-pandemic level. We have also seen a huge amount of proliferation of insurance policies being sold to customers and that is a segment which is growing rapidly,” he said.

On the home care package for COVID patients, he added, “It is about Rs 80 crore business for us. It has been growing at a very rapid pace. We see a huge amount of potential in this. It gave us a major fillip during COVID. Home care across major metros has gone up significantly during this period.”

For the full interview, watch the accompanying video

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow