Expect to hit full-year profitability in FY24: Practo CEO Shashank ND

The healthcare technology and services firm expects to grow at 100% y-o-y delivering about Rs 400 cr in revenue in FY24 and achieving positive cash flow and a full profitable year

Shashank N D, chief executive officer and co-founder of health care technology and services company Practo, has been dedicated to his health for the past nine months. His exercise regimen includes weight training and running about 100 kilometres per month. It’s not just Shashank who has become healthier; his company, Practo, is also moving towards profitability.

“As Practo moves towards profitability, I also become healthier,” said Shashank in an interview.

Practo expects to double its revenue in 2023-24, with the firm projected to grow at 100 per cent year-on-year, delivering about Rs 400 crore in revenue. The company anticipates achieving positive cash flow and a full profitable year with an annual earnings before interest and tax (Ebit) of around Rs 5 crore.

Practo’s revenue grew by 100 per cent overall, from Rs 105 crore in 2020-21 (FY21) to Rs 200 crore in 2021-22 (FY22). The group’s losses went from Rs 79 crore in FY21 to Rs 146 crore in FY22. The firm stated that it exited 2022-23 with an Ebit-neutral position and positive cash flow.

Practo, which began as a software-as-a-service startup about 15 years ago, is now focused on scaling up using a phygital (physical plus digital) strategy that combines digital experiences with physical ones. As part of this strategy, it recently launched Transform, a diabetes management and remission programme.

“During the pandemic, we reached everyone’s homes. Now we are harnessing those tailwinds, creating integrated health care where online and offline (phygital) experiences are closely linked,” said Shashank.

“This aspect of the business is growing well for us. In the health care journey, patients require both online and offline (services),” he added.

For example, Practo is currently piloting an ‘excellence score’ initiative. Here, comprehensive equipment audits are conducted in clinics and hospitals. Based on these audits, the firm develops a score that reflects the quality and standards of the facilities. This score is shared with patients on the platform to ensure transparency and trust in the services.

The company has created a health ecosystem by connecting patients, doctors, pharmacies, diagnostics, clinics, and hospitals. It now serves around 180 million patients annually across its services, with over 120,000 doctor partners on its platform. It has a presence in about 22 countries.

“While we have had a strong presence in Tier-I cities, we believe our penetration in Tier-II and Tier-III cities will significantly increase in the coming years,” said Shashank.

Practo’s business-to-business software contributes to 15-20 per cent of the business, while its business-to-consumer platform contributes to 80-85 per cent of the overall business. This includes appointment booking, e-pharmacy, e-diagnostics, and corporate subscription services. Its end-to-end health care delivery services include telemedicine, chronic care (Transform), and secondary care surgeries.

Another significant opportunity the company is pursuing is government health care projects. As the government works on building digital highways for health care, Practo has been actively collaborating with the National Health Authority (NHA). It supports government initiatives from both the doctor and patient sides.

For instance, it’s deeply integrated with the Unified Health Interface (UHI), a network of open protocols that enable interoperability in health services.

UHI is a foundational layer in the Ayushman Bharat Digital Mission (ABDM) stack.

Under UHI, Practo was selected as one of the early partners for the ongoing NHA pilot.

Practo has also partnered on the personal health records protocol, allowing consumers to share their details for quick and easy registration. It’s one of the six private partners in this integration. This also enables consumers to link their health records to their health care episodes.

With the largest consumer and doctor base, Shashank stated that Practo will play a major role in driving the adoption of ABDM.

According to industry data, the consultations prior to ABDM were valued at approximately $4 billion per year. After ABDM, this is expected to double. To tap into this opportunity, Practo stated that its clinic management software Ray is ABDM-compliant.

Ray by Practo was developed in 2008 to assist doctors in creating digital health records and facilitating consultations. Over the years, it has managed over 190 million appointments.

“We will continue adding more services as government application programming interfaces go live on UHI,” said Shashank.