Apollo Hospitals targets Rs 1000cr revenues by '07

Corporate hospital major Apollo is stitching together an organisational strategy that will see it targeting revenues in the region of Rs 1000 crore by 2007.

This apart, Apollo is earmarking an amount of Rs 70 crore next year for investments in technology hardware upgradation across its hospitals in the country and abroad.

The strategy to maximise revenues from operations includes a three-point agenda that involves improving clinical quality, service quality and increasing revenue per bed.

Speaking to Business Standard, Prathap C Reddy, chairman of Apollo Hospitals group said, "We are targeting revenues of Rs 750 crore and profits of around Rs 75 crore in 2006. We would like to see our numbers grow to a benchmark level of Rs 1,000 crore of revenues and Rs 100 crore of profits by 2007." This fiscal, the Apollo group hopes to achieve revenues of Rs around 590 crore and profits of Rs 40 crore.

"For this, our core initiatives will involve improving clinical and service qualitites besides technological upgradation at a cost of Rs 70 crore for the next fiscal,"Reddy said. The Rs 70 crore spend on technology upgradation will benefit all our centres across India and abroad as well, he added. While Rs 50 crore will be used in hospitals within India, Rs 20 crore will be used for the hospital in Colombo.

"We are also targeting to increase our per-bed revenue from Rs 8,500 at present, to Rs 10,000 per bed next fiscal,"Reddy said. Interestingly, the group will now pro-actively look at shifting the recuperative aspect of patient treatment outside its hospitals so as to ensure that bed-capacities are utilised to the maximum extent possible.

According to Reddy, while plans to list on the US bourse, Nasdaq, were on, the hospital and healthcare major would ideally like the listing to go ahead when it had notched up dollar revenues of at least $100 million. "At present our dollar revenues are only $7 million."

The Apollo group has already said that it is planning to participate in the next round of privatisation of the hospitals run by the National Health Services (NHS) of UK in April 2005.

The NHS is trying to move towards part-privatisation by inviting bidders for management services, from the private health-care sector. If Apollo gets through the bidding process, it will manage to foray into the UK where it so far was involved only through the Global Nurse Programme, through which it sent nurses to the country.