Hospitals see influx of foreign patients in Sept qtr as travel norms ease

Several corporate hospitals say international patient footfalls have crossed pre-pandemic levels

With travel norms easing out, international patient footfalls at hospitals have increased in the September quarter. Several corporate hospitals pointed out that the footfalls had grown over the pre-pandemic levels.

Dilip Jose, MD and CEO of India’s second largest hospital chain, Manipal Hospitals, said that international patient demand for admissions has grown roughly by 10 per cent over pre-pandemic levels. “The overall contribution from international medical tourists is roughly 7-8 per cent of consolidated revenues at the moment. This is because the demand from the domestic market has grown faster,” Jose says, adding that demand from domestic patients has grown by a robust 20-22 per cent, on the back of pent-up demand for elective surgeries.

International patients typically come from West Asia and North Africa, with some traffic from South Asia as well (Bangladesh being a key market), Jose said. The source markets remain more or less the same, post pandemic.

The industry and analysts, however, say how far the demand sustains will be clear by the fourth quarter.

Kunal Randeria, analyst with Nuvama Research said, “Traditionally, the third quarter is muted as far as medical tourist arrivals go, due to the festive season. The fourth quarter would actually show the way for the next fiscal – whether the rise in footfalls in H1FY23 was due to pent-up demand or if this is likely to sustain,” he explained.

Jose agreed too. He felt H2FY23 demand would be an indicator of long-term trends. “If the spike in footfalls is due to pent up demand, then it would be over in the next six months or so,” he added.

Meanwhile, Fortis Healthcare has seen strong momentum in international patient revenues, which stood at Rs 109.3 crore, growing by 164 per cent over Q2FY22, and 23 per cent over Q1FY23. International patient revenues rose to 8.4 percent of the hospital's overall revenues, versus 3.8 per cent and 7.5 per cent in the second quarter last fiscal and first quarter of the current fiscal, respectively.

Prabudas Lilladher analysts guided for 75 per cent occupancy at Fortis Healthcare driven by increasing volumes, improvement in international business. “International biz targets to reach 10-12 per cent in the medium term from the current level of 8.5 per cent,” the brokerage added.

Anil Vinayak, Group COO, Fortis Healthcare, said, “We are witnessing a surge in demand from all the overseas markets across our network in India as patients who could not travel due to the pandemic are now planning their travel. This has resulted in 23 per cent business growth in Q2 as compared to Q1.” In some major hospitals, the contribution to business from international patients stands at around 10 per cent now.

Vinayak added Fortis had reached the pre-pandemic numbers in June this year, and business has seen an upward trend since. The hospital chain expects good growth in this segment in the coming quarter too.

Max Healthcare has seen a 16 per cent sequential growth in international patient revenue – that's is 110 per cent of the pre-Covid-19 average.

Prabhudas Lilladher noted that the Max Healthcare management has guided international business to further improve on the back of resolving visa issues soon due to normalcy in Afghanistan.

Only for Apollo Hospitals, the contribution from international patients is still below pre-Covid, at 6 per cent. ICICI Securities said it is likely to go to 10 per cent by year-end and the target is 15 per cent from thereon.