Market Research Report : Hospital Market in India 2012


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Netscribes (India) Pvt. Ltd., a knowledge consulting solutions company, announces the launch of its report – Hospital Market in India. The Indian hospital market is currently experiencing rapid growth over the last few years and it is expected to continue this trend in the near future.

The report provides a snapshot of the hospital market. It begins with an introduction section which offers a study of the types and specifications of the hospital in India. The market overview section provides an insight into the current and forecasted market size of the equipment.

An analysis of the drivers explains the factors for growth among which are the dearth in hospital beds in comparison to the demand it faces, growing healthcare industry, growing affordability among people, growing medical tourism, increasing lifestyle diseases, changing demographic structure and growing health insurance market. Key challenges include insufficient medical professionals, lack of investment in IT infrastructure and shortage of FDI flows in Indian hospitals.

The next section provides a study on the role of government that is taking measures to raise the number of hospitals both public and private and also providing financial incentives to the private players to encourage them to establish more and more hospitals.

The next section provides the Trends that are developing in the hospital market among which are growth in Secondary Care Hospitals, growing interest of foreign hospitals to start business in India, public private partnership projects, funding from private equity firms, increase in operation of mobile hospitals, domestic hospitals offshore expansion along with telemedicine and health city emergence in hospital market.

The competition section gives overview of hospitals in the country that have grown over time segmented on the basis of region. It is then followed by some hospitals that have or will soon commence operation in 2012-13. Thereafter, the report highlights the features of the major players operating in the market. It includes an elaborate profile of the major domestic players in the market along with their financial analysis. Porters Five Forces Analysis has been incorporated for a brief but effective understanding of the market scenario.

The strategic recommendations section focuses on some effective strategic decisions which can be taken up by companies to increase their market shares.

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Market Research Report : Hospital Market in India 2012

  1. 1. Hospital Market in IndiaMarch 2012
  2. 2. Executive Summary The hospital market is currently worth INR xx units and is expected to reach INR yy units by 20-- Market The sector is divided primarily into public and private along with NGO operated hospitals Constantly rising population results in perennial demand for hospital beds exceeding its supply Drivers: Challenges: Shortage in number of hospital beds Shortage of medical professionals Growing healthcare market Lack of investment in IT infrastructure LE Drivers & Growing affordability among people Shortage of FDI flows in Indian hospitals P Challenges Growing Medical tourism Increasing lifestyle diseases Role of SAM Changing demographic structure Growing health insurance market Government contribution to raise number of hospitals Financial incentives to private sectorGovernment Future Plans Secondary Care Hospitals Private Equity Telemedicine Trends Foreign Hospitals Mobile Hospitals Health Cities Public Private Partnership Expansion plans to foreign shores Major Hospitals Chains Player CCompetition Player A Player D Player B Player E Player F HOSPITAL MARKET IN INDIA 2012.PPT 2
  3. 3. •Introduction•Market Overview•Drivers & Challenges PLE•Role of Government•Recent Trends SAM•Competition •Region wise hospital profiles •Hospitals commissioned in 2012-13 •Key Players•Strategic Recommendation•Appendix HOSPITAL MARKET IN INDIA 2012.PPT 3
  4. 4. Hospitals can be classified on grounds of ownership and clinical operation Public Hospitals Voluntary Hospitals Run by Central Government, Functions with public or private funds State Government and local bodies on a non-commercial basis Ownership Basis ` Private Hospitals Corporate Hospitals E Hospitals owned and operated by Public limited companies formed L individual or group of people as under Companies Act run P business for purpose of profit earning commercially and is likely to operate chain of hospitals M HOSPITAL General Hospitals Rural Hospitals SA Hospitals staffed by at least two medical officers that provides in- patient accommodation and medical care for more than one category of medical discipline Located in rural areas permanently staffed by at least one physician that provides in-patient accommodation and medical care for more than one category of medical discipline Specialized Hospitals Teaching Hospitals Clinical Basis ` Provides medical attention for one A hospital to which a college is attached discipline and is administratively for medical/dental education attached to a general hospital Isolation Hospitals Tertiary Hospitals Hospitals for the care of persons State and Central government suffering from infectious diseases established in their state capitalsSource: HOSPITAL MARKET IN INDIA 2012.PPT 4
  5. 5. Hospital market accounts for half of the healthcare sectors revenues that has tremendous future growth potential Market Overview Market Size and Growth – Private • Hospitals are a major component of the Indian INR tn Healthcare industry forming a more than 50% of 4 healthcare sector revenues X7 • The hospital market is currently worth INR X1 units a X6 and is expected to reach INR X7 units by 20-- X5 • The market is expected to grow at a CAGR of a% X4 between 20-- to 20-- 2 X3 LE X2 • The hospital sector is divided into of public and X1 private operated P In 20-- total number of hospitals was XX of which A1 were public operated while the remaining B1 were private M 0 20-- 20-- 20--e 20--e 20--e 20--e 20--e A In 20-- total number of hospital beds was estimated to be YY of which A2 was under public ownership and the hospital beds far exceeds the supply S remaining B2 was under private ownership • With the constant rising population, demand for According to recent study conducted by WHO, there are only p beds per 1000 population which is far below the target of q beds per 1000 population by the Indian Health Hospital Market Segmentation – 20-- Ministry Hospitals A1% B1% • A huge shortage of beds is a major driver for investment in the hospital industry There is a trend of growth in speciality and multi speciality Hospital Beds A2% B2% hospitals in the country A B 100%Source: HOSPITAL MARKET IN INDIA 2012.PPT 5
  6. 6. Drivers & Challenges – Summary Drivers Shortage in number of hospital beds Growing healthcare market Challenges Growing affordability among people PLE Shortage of medical professionals Growing medical tourism Growing health insurance market SAM Lack of investment in IT infrastructure Shortage of FDI flows in Indian hospitals Increasing lifestyle diseases Changing demographic structure HOSPITAL MARKET IN INDIA 2012.PPT 6
  7. 7. Role of Government: Summary Direct and Indirect Initiatives PLE Role SAM of Government Future Plans Financial Incentives HOSPITAL MARKET IN INDIA 2012.PPT 7
  8. 8. Trends - Summary Secondary Care Hospitals Foreign hospitals are showing interest to penetrate Indian market Indian hospitals expansion plans to foreign shores Private Equity Trends ` PLEMobile Hospitals SAM Telemedicine Health Cities Public Private Partnerships HOSPITAL MARKET IN INDIA 2012.PPT 8
  9. 9. Major Public Companies - Summary Net Profit (INR mn)500,000,000400,000,000 Size of bubble represents300,000,000200,000,000 PLE Market Capitalization in INR xx M100,000,000 A 0 B A-100,000,000-200,000,000-300,000,000 S-400,000,000-500,000,000-600,000,000 Revenue-700,000,000 (INR mn) 19,000 19,500 20,000 20,500 21,000 21,500 22,000 22,500 23,000 23,500 Player A Player B HOSPITAL MARKET IN INDIA 2012.PPT 9
  10. 10. Public: Domestic Company – Company A Ltd (1/4) Company Information Head Office and Hospital Network– India Company A Address Line 1 Corporate Address Address Line 2 City Tel No. xxx Fax No. Website Year of Incorporation yyy 19-- PLE Ticker Symbol Stock Exchange Products and Services mmm --- SAM City N City M Head Office City O Hospital Network Key People Category Products/Services Healthcare Facilities Name Designation Person A Founder, Executive Chairman Healthcare Consultation Managing Director, Executive Person B Director Others Person C Chief Executive Officer Person D Group PresidentSource: HOSPITAL MARKET IN INDIA 2012.PPT 10
  11. 11. Public: Domestic Company – Company A Ltd (1/4) Financial Snapshot Key Ratios Total Income y-o-y change Particulars 20-- 20-- 20-- 20-- INR unit INR unit (20– to --) Net Profit / Loss Y4 Profitability Ratios25 2.020 Y3 Operating Margin Y2 1.5 Net Margin15 Y1 X4 1.0 Profit Before Tax Margin10 X3 X2 0.5 Return on Equity 5 X1 Return on Capital Employed 0 0.0 Return on Working Capital 20-- 20-- 20-- 20-- Return on Assets LE Financial Summary Return on Fixed Assets Cost Ratios P • The company incurred a net profit of INR Y4 unit in FY 20--, as Operating costs (% of Sales) compared to net profit of INR Y3 in FY 20-- Administration costs (% of M • The company reported total Income of INR X4 in FY 20--, registering Sales) Interest costs (% of Sales) A an increase of m per cent over FY 20-- Liquidity Ratios S • The company earned an operating margin of n per cent in FY 20--, an Current Ratio increase of o percentage points over FY 20-- Cash Ratio • The company reported debt to equity ratio of p in FY 20--, an Leverage Ratios increase of q per cent over FY 20-- Debt to Equity Ratio Debt to Capital RatioFinancial Summary Interest Coverage RatioIndicators Value (dd/mmm/20--) Efficiency Ratios Market Capitalization (INR) Fixed Asset Turnover Asset Turnover Total Enterprise Value (INR) Current Asset Turnover EPS (INR) Working Capital Turnover PE Ratio (Absolute) Capital Employed TurnoverSource: Improved Decline HOSPITAL MARKET IN INDIA 2012.PPT 11
  12. 12. Public: Domestic Company – Company A Ltd (1/4) Key Business Segments Key Geographic Segments A B C 100% The company 100 operates only 80 in Country A A4 60 A3 A2 40 A1 LE B4 20 B3 C1 B1 C2 B2 C3 C4 0 P 20-- 20-- 20-- 20-- 20-- M Business Highlights Description Overview Services SA News • Treatment facilities in fields of cardiology, oncology, neurology, orthopedics • Telemedicine services, education, training programs & research services and a host of other non-profit projectsSource: HOSPITAL MARKET IN INDIA 2012.PPT 12
  13. 13. AppendixRatio Calculations Ratio Calculations (Operating Current Assets / CurrentOperating Margin Current Ratio Income/Revenues)*100 LiabilitiesNet Margin (Net Profit / Revenues) *100 {(Cash & Bank Balance + Cash Ratio Marketable Securities) / Current (Income Before Tax / Revenues Liabilities)}Profit Before Tax Margin *100 LE Total Liabilities / Shareholders Debt to Equity (Net Income / Shareholders Equity PReturn on Equity (ROE) Equity)*100 {Total Debt / (Shareholders Debt to Capital Ratio M EBIT / (Total Assets – Current Equity + Total Debt)}Return on Capital (ROCE) Liabilities)*100Return on Working CapitalReturn on Assets *100 SA (Net Income / Working Capital) (Net Income / Total Assets)*100 Interest Coverage Ratio Fixed Asset Turnover Asset Turnover EBIT / Interest Expense Sales / Fixed Assets Sales / Total AssetsReturn on Fixed Assets (Net Income / Fixed Assets) *100 (Operating Expenses / Sales) Current Asset Turnover Sales / Current AssetsOperating Costs (% of Sales) *100Administration Costs (% of (Administrative Expenses / Sales) Working Capital Turnover Sales / Working CapitalSales) *100 Capital Employed Turnover Sales / Shareholders EquityInterest Costs (% of Sales) (Interest Expenses / Sales) *100 13
  14. 14. Thank you for the attentionThe Hospital Market in India report is part of Research on India’s Healthcare Industry Series.For more detailed information or customized research requirements please contact:Tamojit RoyPhone: +91 33 4064 6215E-Mail: tamojit.roy@netscribes.comResearch on India is a product of Netscribes (India) Pvt. Ltd. Research on India is dedicated to disseminating information and providing quickinsights on “hot” industries in India and other emerging markets. Track our new releases and major updates in these industries onAbout NetscribesNetscribes is a knowledge-consulting and solutions firm with clientele across the globe. The company’s expertise spans areas of investment &business research, business & corporate intelligence, content-management services, and knowledge-software services. At its core lies a truevalue proposition that draws upon a vast knowledge base. Netscribes is a one-stop shop designed to fulfil clients’ profitability and growthobjectives.Disclaimer: This report is published for general information only. Although high standards have been used the preparation, Research on India,Netscribes (India) Pvt. Ltd. or “Netscribes” is not responsible for any loss or damage arising from use of this document. This document is thesole property of Netscribes (India) Pvt. Ltd. and prior permission is required for guidelines on reproduction. 14