Shalby Hospitals

Shalby Ltd - Looks very very promising

Q2 concall highlights -

Sales - 243 cr, up 18 pc
EBITDA - 58 cr, up 37 pc !!!
PAT - 27 cr, up 50 pc !!!

Net Cash on books @ 70 cr
Q2, annualised ROCE @ 21 pc vs 13 pc LY

Company owned hospitals - 9 across western, central India with headroom to grow bed capacity without any major capex in most facilities. Shalby remains a leader in Joints replacement. Currently diversifying into Onco, Critical care, general medicine and transplants

Franchise hospitals - 06 facilities. Shalby ltd monitors quality of services via FOSO ( franchise owned, shalby operated ), FOSM ( franchise owned, shalby managed )models. All of them have ortho, joint replacement heavy models. Company gets into a franchise agreement only after stringent channel checks to maintain the reputation of the brand

Implants - manufacturing USFDA approved implants for sale across US, RoW. In long term, aim to make it a 800 cr business ( ie inside 5 Yrs ). Current annual run rate at aprox 60 cr / yr. The business is already EBITDA positive ( although marginally )

Surgery count in Q2 -

Anthroplasty - 3800, up 18 pc
Nephro and Urology - 740, up 42 pc
Onco - 480, up 22 pc
Cosmetic - 760, up 10 pc
Ortho - 740, (-) 13 pc
Others - 1080, up 17 pc

Payor mix -

Self pay - 35 pc
Insurance - 44 pc
Govt schemes - 21 pc

Last 5 yr sales CAGR @ 20 pc, EBITDA CAGR @ 22 pc

Q2 occupancies @ 54 pc vs 49 pc in Q2 LY (company doing 22 pc EBITDA at mid 50s occupancy - this is absolutely out of this world)

Implants business likely to pick up momentum in H2

Current sales contribution from Ortho + Anthroplasty @ 40 pc vs 100 pc 15 yrs back

Aim to reach a total of 40 FOSO + FOSM hospitals in next 3-4 years

As the capacity utilisation improves, EBITDA should keep improving

Avg rise in ARPOB on an annual basis @ 6-8 pc - likely to be similar going forward as well

As the franchise owned- Shalby managed hospitals scale up - this will lead to a further expansion in EBITDA margins ( which are already more than healthy )

Aim to reach 7-8 pc kind of EBITDA margins in the implants business by end of this FY

Increased inventory levels due anticipated pick up in Implants business specially in Q4

Expecting similar growth in Q3 on a YoY basis as was seen in Q2 in the Hospitals business

Looking to expand via Franchise / Owned hospitals model in cities like - Delhi NCR, Kolkata, Lucknow, Patna

Have set up a number of OPD centers in East Africa, Middle East, Bangladesh, Nepal - to rope in Medical Tourism patients. Medical tourism is EBITDA accretive

Disc: holding, biased, bullish, not SEBI registered


Notes from ICRA credit report:
Shalby has acquired 87.26% stake from the founders of PK healthcare pvt ltd(PKHPL).
PKHPL owns Sanar international hospital , Gurugram spread over 1.27 acre plot taken on lease basis.
Current capacity is 130 beds which can be expanded to 180 beds.
70% of business from international markets.
Sanar hospital offers specialties like Oncology, Cardiac, Transplant services, neuro , Bone & joint surgeries.

Turnover last 3 years:
FY21: Nil
Fy22:1.7 Cr

Cost of acquisition for 87% stake is Rs. 102 Cr.
40-45 Cr of net debt on books of PKHPL which leads to net debt of ~140 Cr for Shalby.

Even though current bed capacity is 130 beds, only 50 beds were operational(not official information)

Considering the valuation per bed of other hospital in the region, this looks like decent acquisition. Shalby must be planning to target international patients through this acquisition.
Diclosure: Buying during last few days…no meaningful allocation in PF as of now.


Shalby Ltd -

Q3 FY 24 results and concall highlights -

Revenues - 220 vs 207 cr, up 6 pc
EBITDA - 47 vs 38 cr, up 23 pc ( margins @ 21.2 vs 18.5 pc )
PAT - 19 vs 15.5 cr, up 25 pc

Standalone Revenues @ 200 cr, EBITDA @ 47 cr, PAT @ 25 cr ( all grew at very healthy rates )

Net Cash ( minus debt ) on books @ 61 cr

Company’s portfolio / businesses -

10 Multi Speciality hospitals across West, Central and North India. A leader in Joint replacement in the represented market

60 OPD domestic clinics + 16 international OPD clinics ( mainly in Africa )

06 Franchisee hospitals

US based Knee and Hip implants manufacturing facility

Total bed capacity @ 2150 + beds, present across 13 cities in India

Q3 operational matrices -

ARPOB @ 37.3 vs 36.3 k
Occupancy rate @ 47 vs 43 pc
Surgery count @ 6746 vs 6782

Hospitals business segmental revenue percentages -

Anthroplasty - 43 pc
Critical care - 9 pc
Cariac - 9 pc
Onco - 10 pc
Ortho - 10 pc
Neuro - 5 pc
Nephro - 4 pc
Others - 11 pc

Hospitals business payor mix -

Self pay - 35 pc
Insurance - 41 pc
Govt - 24 pc

Implants business sales mix -

India - 57 pc
US - 43 pc

Implants business financials -

Revenues @ 21 cr, up 46 pc
EBITDA @ 20 lakh
No. of constructs sold @ 2630 ( 70 : 30 - Knee : Hip )

Company invested 102 cr to acquire 87 pc stake in Sanar International hospital Gurugram. Its current bed capacity is 130, expandable to 180. This hospital caters mostly to international clients ( 68 pc of its revenues )

Still have the vision to grow the implants business to 800 cr / yr kind of sales in 5 yrs

Sanar International is likely to do a 30-35 cr / Qtr kind of topline for next yr. Also, the ARPOBs here are much higher - in the range of 1 lakh. However, current occupancies are low @ around 25 pc. Currently making EBITDA losses

Aiming to do high single digit EBITDA margins from the implants business by end of next yr

Mumbai - is a Greenfield project ( Hospital ) that’s lined up by the company. May take 3-4 yrs to go live

Aiming for 20-22 pc growth in EBITDA for next FY without accounting for the new facilities and inorganic opportunities like the Sanar hospital

Seeing pickup in no of surgeries in Jan, Feb 24. Confident of doing better business in Q4 vs Q3
Disc: holding, biased, not SEBI registered

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Shalby Limited to complete the transaction for Gurugram Hospital
The Comapny, has announced a strategic investment in Healers Hospital Private Limited (Healers Hospital) with an acquisition of 100% equity stake for a consideration of Rs 104 Cr (approx). This equity stake will be acquired within a period of one month, through secondary buy‐outs.This investment is in continuation with Shalby’s strategy to consolidate asset base for its recent acquisition of Sanar International Hospital (P K Healthcare Pvt Ltd.) at Gurugram. Sanar International Hospital is currently operating under leased land held by Healers Hospital.
With this acquisition, Shalby has changed its business model from Leased model to ownedmodel for its recent acquisition of Sanar International Hospital in Jan 2024.
With this acquisition, Shalby will unlock the consolidated profitability of the group to the tuneof leased rentals expense, ensure the lifelong continuity of Sanar Hospital at owned land modeland also unlock the future value of asset being present at a prime location i.e. Golf Course Road, Gurugram.

Healers reported revenue Rs 6.73 Cr (Rental Income) , which will be net saving!!!
Microsoft Word - SE Compliances 2023-2024 (

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Financial arrangement with Bajaj Finance
def2b6ae-320c-4e18-b272-b9b4ea216a20.pdf (1.3 MB)

Expected Revenue ~ Rs 150 Cr in FY26.!!!

Is Sanar International Hospital is the game game-changing strategy of Shalby?

Some interesting facts:

we have acquired a majority stake in Sanar International Hospital that is PK Healthcare Private Limited with a control of 87.26% equity stake by investing Rs.102 Crores as primary and secondary infusion. This will help Shalby to accelerate its presence in the Delhi/NCR region with a vision to scale up international business and also to consolidate its presence in the northern part of India. This facility is located at prime location of Golf Course Road Gurugram with a land parcel of 1.27 acres which has been taken on long-term lease with a total build-up area of 125000 square feet. The current capacity of the facility is 130 beds and can be expanded to the level of 180 beds with additional capex. At present the hospital generates around 68-70% business from the international market which comprises 43% from Middle East, 15% from Africa, 8% from CIS and remaining from others catering to more than 60 countries. Sanar offers comprehensive, advanced surgical care in the specialties such as cancer, heart, blood, marrow transplant, kidney and liver transplant, bone and joint and neurosciences among other specialties.

The very unique about this hospital is that 70% of the topline that is generated here is from international business, and 30% is from domestic business. It does some of the most high-end treatments which are done in tertiary quaternary care hospital in India. It does a lot of bone marrow transplants, kidney transplants; liver transplants and has all the offerings that every other Shalby unit offers for a total comprehensive kind of care. What we believe is that because of the ongoing run rate of that particular hospital in terms of the revenue it has been generating we believe 120 to 150 Crores will be the right target for this hospital for the next 12 months from now and given the kind of ARPOB that we are able to generate over there which has been over Rs.1 lakh in the past. We believe that we will be able to add significant topline to our existing hospital business through this hospital over the next three to four years.

This looks like a greenfield project but the color of brownfield : This hospital started close to 20 months back and in the hospital business if you can see the first couple of years are EBITDA negative, they are operating at close to around 15% EBITDA negative because the occupancy level even with 70% of business are not very high they are close to around 20-22% occupancy but with the synergy and from the next year onwards the occupancy will ramp up and we are firm that we are going to have a higher single digit EBITDA in the next year and high double digit EBITDA in the year thereafter.


acquisition in Bijnor UP

Bijnor is 1 Lakh population town, hospital is new, have good land and built up. But seems ramp up is very slow. But given the linkage with Sanar, we can consider it as single acquisition.

But why Shalby was the preferred choice for the selling management? It seems good asset even for big hospitals!

Disclosure: Invested

Please share announcement of Bijnor !!!

HI All,

Can somebody elaborate on how it’s franchisee business works.

Shalby Ltd -

Q1 FY 25 concall and results highlights -

Revenues - 288 vs 240 cr, up 20 pc
EBITDA - 55 vs 47 cr, up 15 pc
PAT - 15 vs 20 cr ( due higher Interest and Depreciation costs + increased tax rate )

Net Debt @ 168 cr
RoCE ( annualised for Q1 ) @ 13.6 pc

Hospitals business highlights ( only of standalone business ) -

Revenues - 240 vs 216 cr
EBITDA - 58 vs 49 cr
PAT - 30 vs 26 cr

Company’s Hospitals portfolio -

Hospitals - 16 - 11 multi speciality, 05 single speciality

Company owned and operated units - 10

Franchise units - 6 ( FOSM - 4, FOSO - 2 )

Bed capacity @ 2350

Doctors team @ 1150

OPD clinics - 60 Domestic, 23 International

Payor Mix -

Self Pay - 35 pc
Insurance - 41 pc
Govt Schemes - 24 pc

Operational matrix of Shalby Sonar Hospital ( acquired LY ) -

Revenues - 24 vs 20 cr
EBITDA - (-) 0.35 cr - company is confident of turning this around in near future
ARPOB - 79k
Occupancy @ 26 pc
56 pc of revenues generated from international patients
Bed Capacity @ 130 beds
Expertise in Kidney, Liver and Bone marrow transplant

Homecare business clocked a revenue of 3.7 vs 3.6 cr YoY. Patients served @ 7.3k vs 7.6k YoY

Revenues from FOSO hospitals ( franchise owned, Shalby operated ) - 2.6 vs 1.5 cr

Revenues from FOSM hospitals ( franchise owned, Shalby managed ) - 0.75 vs 1.1 cr

Signed up a new hospital under FOSO model @ Rajkot with a bed capacity of 25 beds

Implants business -

Revenues - 26 vs 16 cr
EBITDA - (-) 0.7 cr (-) 0.35 cr ( due front loading of a lot of marketing expenses )
Implants sold @ 3475 vs 1410 pieces
India sales @ 56 pc, US sales @ 44 pc

Company has sharpened its focus on cost cutting wrt their implants business and hiring multiple vendors for supply of similar components

Company is the largest hospital chain in the world in terms of Joint Replacement surgeries performed

Consolidated occupancy rates stood @ 50 pc ( clearly there is a lot of scope for improvement )

Company believes that weakness in homecare business is an aberration. Should see a pick up in the coming Qtrs

Expect Sanar hospital to be EBITDA positive going fwd. Aim to make it PBT positive by end of FY 25 or thereabouts

The Rajkot FOSO Hospital should go live in Q2. A few more Franchise deals are in the pipeline. Company is not disclosing them as yet due competitive reasons

Higher finance costs in Q1 due higher working capital requirements of the implants business and the additional debt taken up for the Sanar acquisition. Higher finance costs will only moderate by next FY once the Implants business stabilises

Disc : holding, biased, not SEBI registered, Concall and results summary posted only for educational purposes

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Over the period of time, they are improving Two Matrix 1. ALOS 2. ARPOB but still challenge on the occupancy which is still less than 50%. On the Hospital and healthcare business, understand Delta of Revenue and Delta of Profit:
Suppose Occupancy from 50% to 60%, considered Q1 Revenue - 240 Cr on 50%, then on 60% occupancy will be 288 / 290 Cr then Delta of Revenue 50 Cr and same time Delta of Profit ~ 40% i.e. 20 Cr (Due to most of Fixed Cost like Manpower, electricity, rental already absorbed on Rs 240 Cr revenue the additional cost is Pharmacy, consumable and Doctor Cost)
So, Improvement in Occupancy, also one of the important matrix for investors point of view.