By IANS
Chennai : The Mumbai-based corporate hospital group Wockhardt Hospitals Ltd is confident of maintaining its profits this fiscal, said a top official.
The company has earned a total income of Rs.2.59 billion ($65.7 million) and net profit of Rs.73 million ($1.9 million) for the nine-month period ended Dec 31, 2007.
This shows a sharp decline in the net profit of the company from the last fiscal figures. The hospital group had posted a profit of Rs.155.9 million ($3.9 million) and total revenue of Rs.2.36 billion ($59.9 million) in the last financial year.
“The reduction in profit is due to increase in interest cost and depreciation as the company is in a process of expanding its hospital network. We are confident of matching the last year’s profit after repaying Rs.2.85 billion ($72.4 million) debt,” Anil V. Kamath, managing director, said here Tuesday.
The company is also planning to enter the capital market with an initial public offer (IPO) of 25,87,097 equity shares of Rs.10 each at a premium to be determined through book building process.
The issue will open on Jan 31, 2008, and close on Feb 5, 2008. The price band has been fixed between Rs.280 and Rs.310 per share.
According to Kamath, 500,000 shares will be reserved for the hospital employees.
The major goal of the issue of shares is to meet the cost of construction of four greenfield hospitals and development of six brownfield hospitals.
“Brownfield hospitals are the hospitals in tier-II cities which we take on 30-year lease and manage under the Wockhardt brand. The original owner will have a share in the topline (revenue),” he explained.
The total estimated cost is around Rs.56.94 billion ($1.4 billion) for the hospitals.
Presently, Wockhardt has six greenfield and nine brownfield hospitals under its fold with a total bed capacity of 1,374.
“We have plans to increase the greenfield units by five and the brownfield units by 12,” Kamath added.
The average occupancy rate is around 68 percent and the average revenue per bed is between Rs.4 million ($101,561) and Rs.5 million ($126,951).
Speaking about the hospitals’ focus areas, Lloyd Nazareth, chief operating officer, said: “Our focus will be on cardiac, neurological, critical care, orthopaedics and minimally invasive surgeries.”