Kovai Medical Care and Hospital - Health and Wealth


(Ravindra Mutyala) #62

Stock is in rally mode with 4 straight upper circuits. Any news in making?


(Nirav8) #63

Hi Ayush,
Any Particular rationale for setting up 4MW solar plant (which could cost around Rs 30-35cr), even though Power & Fuel cost is largely stable at Rs 8-9 cr annually. Would it have been better if amount was used in capex ?
Whats the status on 300 bed facility expansion at Sholinganallur, Chennai ?
Thanks.


(Ravindra Mutyala) #64

Hi Nirav,

Saving 8 cr on 35 cr investment is very good as it is 22.5% return (16% if u consider tax of 30%) , much higher than cost of capital. It will create a value of 140cr market cap for investors (at current 25PE :grinning:)

Please let me know where did u get these figures of 8-9cr and 30-35cr


(Nirav8) #65

Hi Ravi,
Power & Fuel consumed has been largely stable at Rs 8-9cr (which is part of other expenses as per annual report).
As per someone tracking power sector cost of setting up solar power plant is Rs 7-9cr per MW. He was of view that setting solar plant would be helpful in saving power fuel cost as well as enable company to use accelerated depreciation. Would appreciate views on the same and if someone can get status of chennai expansion.
Thanks.


(Ayush Mittal) #66

Hi Nirav,

I agree and would have been happier to have seen this amount get used to repay debt or do some capex, if needed. At the same time, I don’t think it’s a material negative. Solar does has some positives too.

Regards,
Ayush


(neerajrana131) #67

Hi

I recently joined valuepickr and have started tracking Kovai medical. Was looking at their Qtrly P&L statement and observed that the other expenses (Dec 15) have increased to 55.26 cr against 29.94 cr ( Dec 14) an year before and 27.47 cr for Dec 13. What could be the reason for such sharp increase in the other expenses?

Also the share prices fell sharply in 1st week of Feb. Was there a specific reason for it?

Neeraj


(Jagadish) #68

It looks like some perceived misuse of funds. I came to know that shareholders have formed an association to stop this malpractice of management spending shareholder money in lavish parties. This could be one reason why other expenses showing disproportionate increase. However, i dont know have any contact information of this association. Management should clarify on this.
Regards,
Jagadish

P.S: As i don’t have any proof, Moderator can delete this message if it is voilation of code of conduct of this forum.


(Ayush Mittal) #69

Being a shareholder, I also received the letter from the investor association. They may be right on 2-3 points but felt that some of the points were exaggerated. Overall I feel the management of Kovai has done a good job till now…reason - they have the best margins in the whole industry. Had the management been doing wrong things, such kind of performance won’t have been possible. But still, we should try to find more about it.

Regards,
Ayush


(indirachitra) #70

I had one my friend admitted in this hospital the general public opinion is they are cheating and people are shifting to psg medical college hospital that guy nala paliniswamy promoter is really not the kind you will associate with health industry and with good single speciality hospital which are world famous like ganga hospital for orthopaedic gem hospital for gastro Arvind hospital for eye Ramakrishna for oncology are gaining immense respect functioning in Coimbatore with more compassion and professional ethics this guys will hit the ground with Coimbatore and Tirpur people for sure not a long term prospect according to IMHO


(Anup Agarwal) #71

@ Neerajrana, Is it 55.26 cr or 38.50 cr other expenses in dec 2015 qtr.


(gomramkar) #72

This is my first post. I am still learning the rudiments of investing.

I do agree that some people have a different view on Nalla Palanisamy, the promoter. But I don’t think, KMCH will hit the ground, anytime soon. I am living near this hospital for the last 10 years and hence have to visit the hospital regularly, whenever the family members of my friends get admitted. I can say with all certainty that there is a steady rise in the number of patients coming here for treatment. A few doctors in this hospital are considered to among the best in the country.

Ganga hospital, Gem Hospital and Arvind are also doing well. That in no way can affect the growth of KMCH, as the market seems to be too big, given the fact that nowadays, more and more people from places like Erode and Salem (located within 160 km distance) also prefer to take treatment in Coimbatore.

Still, I will not bet on KMCH, until I get the confidence that the growth of KMCH will result in the growth of investors.


(Anup Agarwal) #73

Ayush can you share the contact number of the investor association. I would like to know their concern about the management.


(ragav) #74

Kovai medical hospitals - I have been following this company for past 1 year and as I’m a native of Coimbatore and have some contacts in management .
The hospital which makes it a special is the availability of treatments that differentiates the hospital from others . It’s a regional hospital and the main source of income for a militi speciality hospital is its doctors who are of good standards , The attrition rate of doctors are pretty low and many doctors have been. With hospital for more than 10 years . Which shows management is keen on giving good treatments to its patients. There has been continuous capex planned and executed which is another positive thing about the management .
I know a few doctors and staffs and a director of the board through which I am comfortable with its growth plans , and as the sector is highly capital intensive it has to spend every year on labs and other equipments to stay in par with other competitors . It has opened a new branch in Ram Nagar and Sulur are of Coimbatore recently scaling operations and providing affordability to the patients around that area

A subsidiary of KMCH purani hospital supplies acquired a bulk no of shares of the hospital in the previous years . The stock is illiquid which can be another term for where the company can be viewed in longer term perspective .

Disc - Invested , My opinions may be biased


(Ayush Mittal) #75

The contact details mentioned are - [email protected] ; [email protected] ; 9843033199


(Anup Agarwal) #76

Thankyou Ayush for the reply


(ragav) #77

KMCH introduces Mobile stroke care unit . The system would be first of its kind in the region . The unit would be able to diagnose if the patients symptoms are due to bleed in brain or block in the vessel and start initial treatment for patients on the way to the hospital which saves 1 hour of the time .

The unit is equipped with a CT scanner a stroke expert either on board or through telemedicine , An ECG machine and a lab testing facility . The ambulance will do blood check up and cholesterol checks and medical records of the patient . When patient reaches the hospital the clot is either reteived out or through a Clot suction machine the Clot suction machine too is a new tech in the area as other hospitals still uses the old technology of dissolving the clot through 4 drugs .

The ambulance is imported from USA at a cost of 4 Cr and usage cost of the facilities in the van would be rs 5000. The patient has to be treated within 6 hours of Stroke or the damage or paralysis is permanent says doctor Cherian .

The hospital has plans to tie up with bangalore based Aviators Air rescue to give the city the first Air ambulance in Coimbatore . Charges would en 1.5 laks per hour and would initially operate from out of Coimbatore Aerodrome said Hospital officials .

Source of informations : News in a local daily with Hospital sources

Disc : Not invested , Following closely


(Ravindra Mutyala) #78

Excellent results from KMCH.
Revenue up 13.65% YoY
Net Profit up 42.18% YoY
http://corporates.bseindia.com/xml-data/corpfiling/AttachLive/6C7C4131_A8D8_429D_9B68_A27E9D319452_163612.pdf

Disc: Invested


(hemtan100) #79

Tried reading up a few reports on Kovai to understand the kind of capacities that exist or are planned.
Here’s a summary. Please correct me if I am wrong as I’m only a couple of days into researching this one.

  1. Coimbatore : 1000 bed
  2. City Center Ramnagar: ???
  3. Erode Specialty: 100
  4. Erode Center: 100
  5. Chennai: 300
  6. Salem: 100
  7. Mettupalayam: 100
  8. Karur: 100
  9. Palakkad: 100
  10. Sulur: 100-120

(narendra) #80

Important for companies running hospitals


(jaggarwal04) #81

Hope you all are doing good !
I am tracking ‘kovai medical center and hospital’ from last 6 months and I found this stock quiet alluring. Hence company has maintained their numbers, even improved( margins, RoE, RoCE etc.) despite the nature of industry which is a capital intensive.
But still I am having some queries/Concerns ,it would be really nice if you can help me out.

As per the available data. Company is now having 1000 (approx.) no. Of Bed capacity in total. But what is the current utilization?
Any clarity on expansion plans of the company apart from that they are planning to start construction of new hospital in sholinganallur after receiving the approval?
Can company sustain long by relying less on outsiders money (debt or equity)?
Note: Please correct me if I have mentioned any wrong information.