Global Longlife Hospital and Research coming with an IPO to raise upto Rs 49 crore

Global Longlife Hospital and Research

• Global Longlife Hospital and Research is coming out with an initial public offering (IPO) of 3500000 equity shares of face value of Rs 10 each for cash at a fixed price of Rs 140 per equity share.
  
• The issue will open on April 21, 2022 and will close on April 25, 2022.
  
• The shares will be listed on SME Platform of BSE.
  
• The share is priced 14 times higher to its face value of Rs 10.
  
• Book running lead manager to the issue is Interactive Financial Services.
  
• Compliance Officer for the issue is Deepak Ravidatta Sharma.
  

Profile of the company

The company is known as a Multi Speciality Tertiary Care Hospital of Gujarat with 110 beds well equipped for Medical & Surgical Specialities. As a policy any doctor having experience of more than 3 years can admit his patient in its hospital. It provides platform to the doctors for treatment of their patients. As on December 31, 2021 apart from the 11 full time consultants, the company has team of more than 30 experienced doctors as a consultant to serve its patients. Its staff strength also comprises 37 nursing staff and more than 50 paramedical, corporate and support staff and pharmacists as on December 31, 2021.

The company has adopted the Standard Operating Procedures (SOPs) given by Ministry of Health & Family Welfare. Under the said SOPs every work function of its hospital is defined, every process is written down and every employee is trained in his/her duties as soon as he/she joins. Every equipment is maintained as per a predefined schedule. Every necessary license is obtained and renewed as required time to time. The company is certified by National Accreditation Board for Hospitals and Healthcare Providers (NABH Accredited) which is committed to support improvement of quality of healthcare service in its country for all strata of the population through various methodologies and tools to supplement the efforts of the providers of healthcare service and the requirements of the system at various levels. The main purpose of the company’s promoter is to serve the people, hence, the company is also following the same path for which it put its ethics above the all cost. Through the Mukhya Mantri Amrutum Yojana the company has served over 6,000 patients up till now.

The company has invested in, and have established a IT system both for clinical purposes as well as integrating systems and processes through HMS (Hospital Management System)which includes Central Registration module, Appointment, Barcode Generation, Case Paper Generation, OPD Billing, Procedure billing, IPD Registration, Advance & Refund, Due billing, TPA/Package Billing, User Management, Doctor Sharing, Software Security, Management Reports, Discharge Summary towards streamlining its clinical and administrative functions. It has adopted technology with a view to ensure quick transmission of disease data, subsequent analysis, and prompt disease management.

Proceed is being used for:

• Acquiring land on leasehold basis.
  
• Repayment of loan.
  
• General corporate purposes.
  

Industry overview

India‘s healthcare industry has been growing at a Compound Annual Growth Rate of around 22% since 2016. At this rate, it is expected to reach $372 billion in 2022. Healthcare has become one of the largest sectors of the Indian economy, in terms of both revenue and employment. In 2015, the healthcare sector became the fifth largest employer, employing 4.7 million people directly. As per estimates by the National Skill Development Corporation (NSDC) healthcare can generate 2.7 million additional jobs in India between 2017-22 -- over 500,000 new jobs per year. India‘s healthcare industry comprises hospitals, medical devices and equipment, health insurance, clinical trials, telemedicine and medical tourism. These market segments are expected to diversify as an ageing population with a growing middle class increasingly favours preventative healthcare. Moreover, the rising proportion of lifestyle diseases caused by high cholesterol, high blood pressure, obesity, poor diet and alcohol consumption in urban areas is boosting demand for specialised care services. In addition to these demographic and epidemiological trends, COVID-19 is likely to catalyse long-term changes in attitudes towards personal health and hygiene, health insurance, fitness and nutrition as well as health monitoring and medical check-ups. The pandemic has also accelerated the adoption of digital technologies, including telemedicine.

The healthcare market can increase three-fold to Rs. 8.6 trillion (US$ 133.44 billion) by 2022. In Budget 2021, India‘s public expenditure on healthcare stood at 1.2% as a percentage of the GDP. A growing middle-class, coupled with rising burden of new diseases, are boosting the demand for health insurance coverage. With increasing demand for affordable and quality healthcare, penetration of health insurance is poised to expand in the coming years. In FY21, gross direct premium income underwritten by health insurance companies grew 13.3% YoY to Rs. 58,572.46 crore ($7.9 billion). The health segment has a 29.5% share in the total gross written premiums earned in the country. Recent developments. Indian medical tourism market was valued at $2.89 billion in 2020 and is expected to reach $13.42 billion by 2026. Between April 2000 and June 2021, FDI inflows for drugs and pharmaceuticals sector stood at $ 18.12 billion, according to the data released by Department for Promotion of Industry and Internal Trade (DPIIT).

Pros and strengths

Clinical excellence and affordable health care: Since the company has commenced its operation in the year 2015, it deliver clinical excellence through quality healthcare services, supported by a combination of top medical talent, strong clinical and patient safety protocols and investments in new medical technology. Its hospital provide comprehensive healthcare services across a range of specialties and super-specialties. These include Cardiology, Allergy and immunology, oncology, Nephrology, Neurology, Dermatology, plastic Surgery and others. The hospital has been awarded ‘The Best Emerging Hospital’ by Times of India. It offers its various health care services at affordable prices.

Team of medical practitioners: The company’s business is mainly depends on the skills of its Medical Practitioners and the quality of services provided by the healthcare staff members. Apart from the Full time doctors it has team of well experienced team of consultants of various field of medicines to provide the quality healthcare services to the patients. Its dedicated team is trained to take care of the patients and handle all kinds of emergencies. Its healthcare staff members comprise of Medical Director, Quality Manager, Clinical pharmacist, Microbiologist, Medical Officers, Clinical Assistants, Infection Control Nurse, Nursing staff, Attendants, Paramedical staff, Dietician/Nutritionist, Medical Transcriber, Biomedical Engineers and etc. who all are well trained for their services towards its patients.

Prime location of Hospital: The location is the prime importance for the hospital to run successfully. The company’s Hospital is situated off sindhu bhavan Road, known as SBR, which is well developed and one of the prime location of Ahmedabad City. Its hospital is situated at Opp. Auda Garden, Nr. Water Tank, Bodakdev, Ahmedabad having 1339 sq mt area. The location is well connected by road hence the inflow of patients from various part of the City is easy.

Risks and concerns

Business requires to obtain number of approvals: The company’s business operations require it to obtain and renew from time to time, certain approvals, licenses, registration and permits, some of which may expire and for which it may have to make an application for obtaining the approval or its renewal. If the company fails to apply or to renew such registrations and licenses or comply with applicable conditions, then such respective regulatory can impose fine on the company or suspend and/or cancel the approval/licenses which may affect its business adversely.

Outsource some of service functions to third-party contractors: The company currently rely on third party contactors to provide services like refilling Oxygen Tank, supply of medicines, canteen facilities, for the pathology lab, etc. The third party contractors are providing such services on revenue sharing basis, on rental basis or without any cost but with a condition that the operation and maintenance expenditure will be incurred by it. The company does not have any control on third party contractors and they can terminate the service at any time. There is no guarantee that the third party service provider will provide satisfactory services to it and patients. Poor quality service or lapses in service from its third party service providers may expose it to liabilities that it may not be able to recover from the service providers and may adversely affect its brand and reputation.

Operate in highly competitive environment: The company compete on the basis of factors such as Specialties, various service offerings, quality of health care professionals, affordability, Quality of care, Quality of Technology and quality of facilities and Patient Satisfaction. It is constantly required to evaluate and increase its competitive position in each of its markets, including meeting industry standards with regard to compensation of doctors and paramedical staff and offering its patients competitive rates for diagnosis, treatment and procedures. Some of its competitors may be more established and may have greater financial resources, personnel and other resources than it. Existing or new competitors may also price their services at a significant discount to its or offer greater convenience or better services or amenities than it provide. Its competitors may compete with it for doctors and other healthcare professionals.

Outlook

Global Longlife Hospital and Research provides health care services. The company offers Oncology, Ophthalmology, Cardiology, Dermatology, Gynecology, Spine Surgery, Plastic Surgery, Ultrasound, Microbiology, Dialysis, and Physiotherapy among other healthcare services. Global Longlife Hospital is certified by the National Accreditation Board for Hospitals and Healthcare Providers (NABH Accredited). The company is known as a Multi-Speciality Tertiary Care Hospital of Gujarat with 110 beds well equipped for Medical & Surgical Specialities. As of December 31, 2021, the company has 11 full-time consultants, and a team of more than 30 experienced doctors as consultants to serve patients. The company's staff strength also comprises 37 nurses and more than 50 paramedical, pharmacists, corporate and support staff. Global Longlife Hospital is located in Ahmedabad. On the concern side, the company is running Single multi-Specialty Hospital in the City of Ahmedabad and any disturbance or natural calamities may effect adversely the Business and Profitability of the Company. Besides, the company’s future ability to pay dividends will depend on its earnings, financial condition and capital requirements and here can be no assurance that it will generate sufficient income to cover the operating expenses and pay dividends to the shareholders.

The company is coming out with a maiden IPO of 3500000 equity shares of Rs 10 each at a fixed price of Rs 140 per share to mobilize Rs 49 crore. On performance front, In the FY21, Company's total revenue is Rs 3270.27 lakh, which is decreased by 2.51% in compare to FY20 total Income Rs 3354.44 lakh. Decrease in Total Income is due to decrease in other major surgeries and strictly complied the Guideline issued by the Government for the COVID-19. Profit after Tax (PAT) is Rs 103.56 lakh for the FY21 in compare to loss of Rs 86.24 lakhs in FY20. The company plans to expand its Hospital network into markets that are in the radius of 100 kms of Ahmedabad. It is planning to start OPD cum Diagnostic center in the small towns around Ahmedabad. Its Doctors visit on predetermined days on various OPD centers will help it to brand its product, marketing its various services provided by the Hospital and quality clinical treatment to the patients of small town. It intends on implementing various measures to improve its operational efficiencies, including undertaking measures to reduce its consumption of disposable items and avoid wastage. It also intends to maximize its operational efficiency by achieving greater integration and by implementing a stronger supply chain management.