Apollo Hospitals Enterprise Limited · NSE:APOLLOHOSP
Apollo Hospitals Enterprise — Investor Presentation (March 2022)
54 slides from Apollo Hospitals Enterprise's investor presentation, March 2022
Slide 1: Investor Presentation March 2022
INVESTOR PRESENTATION March 2022 1
Slide 2: Disclaimer
DISCLAIMER The information contained in this presentation is provided by Apollo Hospitals Enterprise Limited (the “Company”) to you solely for your reference. This document is being given solely for your information and for your use and may not be retained by you and neither this presentation nor an
Slide 3: Key Highlights
KEY HIGHLIGHTS Leading private sector Attractive industry 01 healthcare services provider 02 opportunity Superior operating & 03 Performance with a Purpose 04 financial track record Strategy for future 05 Strong Governance Structure 06 growth 07 Prioritizing ESG Issues Material 3
Slide 4: Leading Private Sector Healthcare Services Provider
LEADING PRIVATE SECTOR 01 HEALTHCARE SERVICES PROVIDER 4
Slide 5: Apollo Has Always Been at the Fore-front of Development of India's Healthcare Sector
APOLLO HAS ALWAYS BEEN AT THE FORE-FRONT OF DEVELOPMENT OF INDIA'S HEALTHCARE SECTOR Apollo Impact ◼ Improved overall availability of private health care services in India ◼ First in India to obtain international JCI accreditation ◼ Better access to care in semi-urban and rural areas Enhanced Improv
Slide 6: Business at a Glance
BUSINESS AT A GLANCE Data as of March 31, Apollo 24/7# cumulative upto 31st March 22 1 Healthcare 55% 71 9,911 63% 3.96 days INR 45,327 / 4,60,000+ 68,00,000+ Services of revenue Hospitals Beds Occupancy ALOS3 day In-patients Out-patients rates2 ARPOB4 Apollo 1 Health and 9% Of revenue 254 29 1,228
Slide 7: Largest Private Healthcare Services Provider in India
LARGEST PRIVATE HEALTHCARE SERVICES PROVIDER IN INDIA Leading player in India in terms of number of hospitals 71 1 26 25 21 16 14 13 11 11 10 6 Fortis Healthcare Healthcare Global Narayana Max Healthcare Aster DM Care Hospitals Columbia Asia Shalby Ltd Manipal Hospitals Sterling Hospitals Ltd Enterp
Slide 8: Pan India Presence
PAN INDIA PRESENCE Steadily increasing footprint supporting meaningful upside in future 71 hospitals present across India Healthy mix by category Owned hospitals Day care centers / CRADLE Managed hospitals 5 851 851 522 522 Delhi: 5 Amritsar: 1 22 44 9,248 Noida: 1 71 9,911 7,875 Kanpur: 1 Bilaspur:
Slide 9: Largest Pharmacy Platform in India
LARGEST PHARMACY PLATFORM IN INDIA Extensive Pharmacy network also supports the growth of Apollo 24X7 – Digital pharmacy platform Largest pan-India pharmacy network Highly differentiated business model driving growth Chandigarh: 7 Himachal Pradesh: 1 Uttarakhand: 10 Extensive Asset-light model Econo
Slide 10: Attractive Industry Opportunity
ATTRACTIVE 02 INDUSTRY OPPORTUNITY 10
Slide 11: Hugely Under-Penetrated Market with Attractive Dynamics
HUGELY UNDER-PENETRATED MARKET WITH ATTRACTIVE DYNAMICS Private sector players are well-positioned to leverage opportunity given low contribution of government spending Growing Indian Healthcare Delivery industry Public healthcare expenditure is low, with private sector accounting for bulk The healt
Slide 12: Large Market with Strong Growth Prospects
LARGE MARKET WITH STRONG GROWTH PROSPECTS India lags behind other developed and emerging economies in Deaths due to disease is higher while healthcare infrastructure is healthcare infrastructure poor Beds per 10,000 people India’s share as percentage to world 81 43 Global median: 29 29 26 25 21 21 1
Slide 13: Rapid Demand Growth Driven by Demographic Shifts and Other Factors
RAPID DEMAND GROWTH DRIVEN BY DEMOGRAPHIC SHIFTS, CHANGING CONSUMPTION PATTERNS, INCREASING AFFORDABILITY AND FAVORABLE REGULATORY ENVIRONMENT Non-communicable disease accounts for most number of deaths Population in 60+ age group to grow faster Causes of death in India 0-14 years 14-29 years 30-44
Slide 14: India Offers Significant Opportunity for Growth of Medical Tourism
INDIA OFFERS SIGNIFICANT OPPORTUNITY FOR GROWTH OF MEDICAL TOURISM India is fast emerging as a major medical tourist destination Medical tourists (in mn) 0.69 Medical tourism market in India to rise at a CAGR of 65- 70% between fiscals 2021 and 2025 0.23 0.16 2010 2015 1 2019 Treatments mostly sough
Slide 15: Opportunity from Increasing Digital Adoption
OPPORTUNITY FROM INCREASING DIGITAL ADOPTION AIDED BY FAVORABLE CONSUMER BEHAVIOR AND STRONG IMPETUS PROVIDED BY COVID Data driven revolution in the country has led to a generation of digitally inclined consumer… Robust internet subscribers growth… …and rapid tech adoption Internet users (in mm) 974
Slide 16: Performance with a Purpose
PERFORMANCE WITH A 03 PURPOSE 16
Slide 17: Quality Healthcare Services Delivery on the Back of World-Class Clinical Excellence
QUALITY HEALTHCARE SERVICES DELIVERY ON THE BACK OF WORLD-CLASS CLINICAL EXCELLENCE Leaders in clinical quality & excellence – 8 hospitals received JCI accreditations & 321 hospitals NABH accreditations • Responsible ◼ 32 Units ◼ 36 Units procurement with ◼ 7,700+ heart surgeries in FY22 ◼ 29,000+ N
Slide 18: Best-in Class Clinical Standards and Governance
BEST-IN CLASS CLINICAL STANDARDS AND GOVERNANCE The Apollo Standards of Clinical Care to improve patient care and outcomes TASCC & Apollo Quality Program (AQP) Clinical Excellence Operations Quality • Clinical Governance • Patient satisfaction • Apollo Incident Committees hold rates stood at 96% in
Slide 19: Pioneers in Technology Adoption; Service Excellence
PIONEERS IN TECHNOLOGY ADOPTION One of the first to adopt robotic precision in minimally invasive surgery Eleven robotic surgical 2014 2019 2020 systems that enable robotic Proton Beam Therapy, an 3.0 Magnetic resonance One Prism 640 slice dynamic precision in minimally invasive advanced form of rad
Slide 20: Affordable and Accessible Healthcare
AFFORDABLE AND ACCESSIBLE HEALTHCARE Affordable services are made available Transparent Pricing and Customization for Customer requirements Transparency and assurance through Assured Pricing Plans for 100+ procedures Trained financial counsellors assist patients in understanding their options and ch
Slide 21: Patient Privacy and Data Security
PATIENT PRIVACY AND DATA SECURITY Uncompromising in our cybersecurity measures • Management’s involvement in overseeing the group-wide information security system (MISF) • The information security management system applies to the Health Information infrastructure of Apollo’s Data Centres • Certified
Slide 22: AHEL as the Employer of Choice
AHEL as the Employer of Choice Human Capital – Our Bedrock Talent Development • Investment in continuous learning as an integral component of the HR system • All employees undergo safety and upskilling training on a regular basis based on role, domain and individual needs • The performance evaluatio
Slide 23: AHEL as the Employer of Choice
AHEL as the Employer of Choice Diversity, Inclusion and Equity • Committed to promoting diversity and preventing discrimination based on gender, ethnicity, age, socio-economic background, religion, trade union membership, and political beliefs. • An equal opportunity employer, who integrates differe
Slide 24: Superior Operating & Financial Track Record
SUPERIOR OPERATING & 04 FINANCIAL TRACK RECORD 24
Slide 25: Strong Growth in Revenues Across Businesses
STRONG GROWTH IN REVENUES ACROSS BUSINESSES … Total Consolidated Revenues (1) (` Mn) FY 22 Consolidated Consolidated Revenues Revenues of $ 1.9 billion (2) CAGR (FY13-22) of 16%. (1) Revenue is net of fees paid to fee-for-service consultants in Hospitals (2) Revenues of Delhi is not consolidated und
Slide 26: Aided by Strong Operating Metrics (1/2)
… AIDED BY STRONG OPERATING METRICS (1/2) Operational Highlights Occupancy rates remain Average length of stay Average revenue per high despite bed (ALOS) has reduced across occupied bed (ARPOB) has additions the portfolio grown at a healthy CAGR of • Growth of in-patient • Reduced in mature 9% over
Slide 27: Aided by Strong Operating Metrics (2/2)
… AIDED BY STRONG OPERATING METRICS (2/2) Bed Occupancy Rate(1) % In-patient Admissions (‘000) Operating Beds 428 451 478 460 3,930 4,257 4,767(2) 5,153(2) 5,549(2)5,811(2) 6,321 6,724 6,940 7,111 7,246 7,491 7,409 7,875 332 354 374 399 352 265 281 313 76% 73% 73% 71% 72% 71% 68% 211 235 63% 64% 66%
Slide 28: Resulting in Consistent Profitability
… RESULTING IN CONSISTENT PROFITABILITY Segment wise EBITDA Margins (%) 1 24% 24% 24% 23% 23% 22% 22% 20% 21% 22% 21% 21% 21% Mature Hospitals EBITDA target of 23%-24% in 18% the next 2 years. 16% 10%9% 10% 8% 8%* 7% 4% 5% 5% 15 New hospitals including Proton with 2,700+ 3% 3% 3% 2% 3% 2% beds (2,40
Slide 29: And Healthy Return on Investment
… AND HEALTHY RETURN ON INVESTMENT # ROCE - Mature Healthcare Services (%) 30% 33% 24% 17% 15% 19% 18% 19% 20% 20% 18% 18% 20% Steady Improvement in Return on Capital Employed (ROCE) 14% Efficiency (Asset Turnover) Profitability FY 09FY 10FY 11FY 12FY 13FY 14FY 15FY 16FY 17 FY18 FY 19 FY20 FY 21 FY2
Slide 30: FY22: Financial Performance (1/5)
FY22: FINANCIAL PERFORMANCE (1/5) Consolidated Financials (` Mn) FY21 FY22 yoy (%) Total Revenues 105,600 146,626 38.9% EBITDA (Post Ind AS 116) 11,374 21,851 92.1% margin (%) 10.77% 14.90% 413 bps EBIT 5,643 15,844 180.8% margin (%) 5.34% 10.81% 546 bps PAT (before tax adj on Apollo Health Co biz c
Slide 31: Q4 FY22: Segment-wise Performance (2/5)
Q4 FY22 : SEGMENT-WISE PERFORMANCE (2/5) Consolidated Financials (` mn) Healthcare Serv *Health Co & Healthcare Serv Healthcare Serv Group (New & Proton Pharmacy AHLL Consol Group (Mature) Group (Total) Others) Distribution Hospitals 29 14 1 44 Operating beds 5,472 2,350 53 7,875 Occupancy 60% 55% 4
Slide 32: FY22: Segment-wise Performance (3/5)
FY22: SEGMENT-WISE PERFORMANCE (3/5) Consolidated Financials (` mn) Healthcare Serv *Health Co & Healthcare Serv Healthcare Serv Group (New & Proton Pharmacy AHLL Consol Group (Mature) Group (Total) Others) Distribution Hospitals 29 14 1 44 Operating beds 5,472 2,350 53 7,875 Occupancy 63% 64% 52% 6
Slide 33: FY22: Hospital Cluster-wise Operational Performance (4/5)
FY22: HOSPITAL CLUSTER - WISE OPERATIONAL PERFORMANCE (4/5) Tamilnadu Region AP, Telengana Region Total (6) (1) (Chennai & others) (Hyderabad & others) (2) Particulars FY 21 FY 22 yoy (%) FY 21 FY 22 yoy (%) FY 21 FY 22 yoy (%) No. of Operating beds 7,409 7,875 2,043 2,131 1,344 1,344 Inpatient volu
Slide 34: FY22: Hospital Cluster-wise Operational Performance (5/5)
FY22: HOSPITAL CLUSTER - WISE OPERATIONAL PERFORMANCE (5/5) Karnataka Region Others (4) Significant Subs/JVs/associates (5) (Bangalore & others) (3) Particulars FY 21 FY 22 yoy (%) FY 21 FY 22 yoy (%) FY 21 FY 22 yoy (%) No. of Operating beds 769 775 1,011 1,107 2,242 2,518 Inpatient volume 45,392 5
Slide 35: Apollo Health and Lifestyle – Retail Healthcare
APOLLO HEALTH AND LIFESTYLE – RETAIL HEALTHCARE Revenue FY22 of INR 13,125 mm – Primary Care (34%), Diagnostics (30%) & Specialty Care (41%) ◼ Multi specialty clinics that extend Apollo’s expertise to ◼ Dialysis services, PPP centres in AP, Assam & Bihar the neighborhood ◼ 85 Centers ◼ 254 Clinics ◼
Slide 36: AHLL – FY22
AHLL –FY22 (` mio) FY22 Clinics Diagnostics Sugar Dental Dialysis Cradles (IP) IVF Spectra (IP) Key Highlights Network 254 1228 29 95 90 8 15 11 Footfalls/Day* 5818 13409 383 148 1227 41 20 67 AHLL reported Gross ARPP (Rs.)* 1282 760 2863 6486 1515 100398 38652 104185 • EBITDA of ` 1,966 mio as comp
Slide 37: Pharmacy: Capturing the Growth Potential
PHARMACY: CAPTURING THE GROWTH POTENTIAL Proven ability to expand the store network 4,529 4,118 • India’s largest Organized Pharmacy Chain with 3,021 3,428 3,766 Pharmacy presence in ~1000 cities/ towns spread across 21 2,326 2,556 store 1,822 1,503 1,632 States and 4 union territories. 883 1,049 1,
Slide 38: Covid Testing and Treatment – FY22
COVID TESTING AND TREATMENT – FY22 ▪ ‘Project Stay I’ saw success with over 600+ 38,600 + 25,000 room nights. Dedicated beds In -Patients 3,100+ Stay I ▪ Our effort in the Home care segment enabled us to move into 1,51,000 homes, (of which COVID care was at 51,000 homes) and provide medically superv
Slide 39: Strong Governance Structure
STRONG GOVERNANCE 05 STRUCTURE 39
Slide 40: Our Approach to Governance
OUR APPROACH TO GOVERNANCE The basic objective of corporate governance policies adopted by the Company is to attain the highest levels of transparency, accountability and integrity. This objective extends not merely to comply with statutory requirements but also to go beyond them by putting into pla
Slide 41: Executive Board
EXECUTIVE BOARD Dr. Prathap C. Reddy Suneeta Reddy Executive Chairman, Founder Managing Director • Conferred the Padma Vibhushan in 2010 • On the Board since the year 2000 • Conferred the Padma Bhushan in 1991 • Spent 36 years with Apollo Hospitals Dr. Preetha Reddy Sangita Reddy Executive Vice Chai
Slide 42: Independent Directors
INDEPENDENT DIRECTORS Vinayak Chatterjee Bhaskara Mandavilli Nageswara Rao Independent Director Independent Director • On the Board since 2014 • On the Board since Feb 2019 Dr. Pudugramam Murali Doraiswamy Independent Director Som Mittal Independent Director • On the Board since Sep 2018 • On the Bo
Slide 43: Strategy for Future Growth
STRATEGY FOR FUTURE 06 GROWTH 43
Slide 44: Strategy for Future Growth (1/2)
STRATEGY FOR FUTURE GROWTH (1/2) Strategy ➢ Optimise Asset Utilisation in facilities & locations 29 5,752 ➢ Focus on Centers of Excellence with one or two anchor specialties in each Hospitals1 Capacity market Mature Beds Hospitals ➢ Extend and expand oncology presence both through specialization and
Slide 45: Strategy for Future Growth (2/2)
STRATEGY FOR FUTURE GROWTH (2/2) Strategy ➢ Focus on urban markets for Specialty care; expand in clusters ➢ Drive growth in Diagnostics Business – both though Offline and Online Apollo Health 1691 43* ➢ Calibrated clinic expansion model with a combination of owned and & Lifestyle Primary care Specia
Slide 46: Distinctive Digital Ecosystem and Physical Network & Capabilities
… coupled with adequate network and Distinctive digital ecosystem… capabilities Cumulative upto 31st March 2022 Physical network & capabilities ~14 Lakh+ 1 2 3 Doctors across 3mm+ Annual Online Consults Diagnostic centers Hospitals & clinics chronic patients ~14Mn completed 4 5 Registrations Leverag
Slide 47: One Apollo – Transforming Through Integrated Technology and Continuum of Care
ONE APOLLO – TRANSFORMING THROUGH INTEGRATED TECHNOLOGY, CONTINUUM OF CARE AND VALUE PROPOSITION FOR THE CONSUMER Integrated digital strategy leveraging existing network, capabilities and market leadership Focus on investments in advanced technology and innovation – “(re) Invent the health system of
Slide 48: Apollo HealthCo
Apollo HealthCo Reorganization through Slump Sale AHEL • Apollo 24/7 represents Apollo Group’s transformational journey to creating “India’s (Listed) Largest Omnichannel Digital Healthcare Platform” that: Backend Healthcare Pharmacy + — combines the strengths of Apollo Group’s offline healthcare lea
Slide 49: Prioritizing Material ESG Issues
PRIORITIZING MATERIAL ESG 07 ISSUES 49
Slide 50: Inaugural Sustainability Report
INAUGURAL SUSTAINABILITY REPORT Showcasing Apollo Hospitals’ Contribution to multiple stakeholders and UN SDGs Sustainability Report 2020 (published in 2021) • More comprehensive than previous legally required Business Responsibility Reports • Our contribution to UN SDGs highlighted in each thematic
Slide 51: ESG Strategy for Sustainable Growth
ESG STRATEGY FOR SUSTAINABLE GROWTH Achievements in 2020/2021 ▪ Published the Inaugural Sustainability Report to improve Apollo’s external communication on material ESG issues Current ESG ▪ Disclosed a number of operational metrics related to material ESG issues Practice and ▪ Engaged with multiple
Slide 52: ESG Materiality Matrix
ESG Materiality Matrix Multi-stakeholder Approach – ESG risks and opportunities • Affordability of Healthcare • Quality of Care and Materiality Assessment Process • Access to Healthcare Patient Safety (accessibility) • Patient Privacy, EHR • Regular engagement with key • Customer Relationship and Cy
Slide 53: ESG Focus
ESG FOCUS Aligned with International Frameworks to Focus on Material Issues Dimension Issue Energy Management Environment Waste & Hazardous Material Management Data Security* Access & Affordability* Social Capital Product Quality & Safety* Customer Welfare* Selling Practices & Product Labeling* SASB
Slide 54: Thank You
In summary we have over the last 33 years focused consistently on putting the patient at the core of all that we do in the pursuit of clinical excellence and in creating sustainable value for our stakeholders. We ensure strict adherence to business ethics and our governance standards stand exemplar
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