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Shalby Hospitals eyeing acquisitions in Delhi and Kolkata markets

Ahmedabad-based hospital chain Shalby Ltd on Monday said it is planning to acquire value accretive multi-specialty hospitals in markets such as Delhi and Kolkata.

In an interview with CNBC-TV18, Shanay Shah, president, said, “The company had an internal benchmark of reaching a certain level of return on capital employed (ROCE) after our listing. At the moment, we are at about 16-18 percent ROCE for the hospital business and that is the reason we are looking out for potential acquisitions.”

Shah expects the international medical tourism industry to grow by 15-20 percent year on year and added that the hospital has been seeing a higher influx of international patients.

“International medical tourism has been picking up significantly after January. So from Q1FY23 onwards, the company has started seeing a huge jump from the international markets including Nepal, Bangladesh, and East African countries like Kenya, Tanzania, Uganda, etc.,” Shah said.

He said over the next 5 years, the company expects to see 15-20 percent growth year on year in the international medical tourism market.

He added, “The new business model that the company has come out with is the franchise model. Through the franchise model, the company will establish standalone orthopedic centres of excellence that have 30-40 beds in not only metros but tier-I, tier-II, and tier-III towns as well. These will be on an asset-light model. The company has two franchises operational in Udaipur and Ahmedabad and we are going to start in Lucknow next month.”

“For the implants business, the company is very bullish. In the next 5-6 years, the company has a target of reaching about Rs 600-700 crore in the medical implants business. The primary growth drivers in this business would be the US business as well as the Indian market and some of the South East Asian countries. We believe the potential is huge in this business,” Shah said.

Shares of Shalby Ltd ended at Rs 132.20, down by Rs 1.30, or 0.97% percent on the BSE. CNBCTV18

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