In Focus

Spreading Wings

Bhilai-based BSR Healthcare has charted out plans of starting a chain of hospitals and diagnostic centres in Chhattisgarh and Maharashtra, finds out Rita Dutta

The steel plant of Bhilai is the epicentre of a medical revolution in Chhattisgarh (CG) — a state that had woefully inadequate medical facilities even some years back. The credit for re-defining the medical contours of this state should partly go to BSR Healthcare group, which is acclaimed for commissioning the state's first comprehensive cancer hospital (BSR Cancer Hospital in Bhilai) that provides services in all three branches of oncology, for establishing the 175-bed multi-speciality tertiary care hospital Apollo BSR Hospital and fulfilling the demand for high-end diagnostic facilities by operating a slew of eight diagnostic centres nicknamed Bhilai Scan and Research Limited (BSRL). BSRL has always been on the forefront of technology — installing the state's first MRI (initially 0.5 Tesla and then 1.5 Tesla), the first 64 slice cardiac CT, the first mammography and the only Gamma Camera of the state.

Across CG and Beyond

Bolstered by its success and its rapidly increasing top line, the group has geared up to consolidate its market position. It has chalked out plans to start a slew of secondary and tertiary care hospitals in Raipur (the capital of CG), Raigarh (CG), Rajnandgaon (CG) and Nagpur (Maharashtra). The reasons for choosing Raigarh and Rajnandgaon are because most hospitals in CG are concentrated in Bhilai and Raipur, like JLN Hospital & Research CentrE (Bhilai), Apollo BSR Hospital (Bhilai), Medical College Hospital (Raipur), Modern Medical Institute (Raipur), Escorts Heart (Raipur) and Ramakrishna Care Hospital (Raipur).

The projects in CG have been planned as the increase in population density, urbanisation, literacy rate, growth of middle class population, growth in income of middle class population, rising income, shift to life style diseases, increase in ageing population have necessitated the need of good private healthcare facilities across the state.

Market Study & Strategy

"Due to its location and the fact that it is the first major city of Chhattisgarh on NH 6, Rajnandgaon has great scope for secondary care hospital" - Prashant Naidu Executive Director BSR Healthcare

"The investment planned is to the tune of Rs 150 crore (cost of restructuring the building and equipment) for the four hospitals" - Dr MK Khanduja Managing Director BSR Healthcare

Says Prashant Naidu, Executive Director, BSR Healthcare, "For our expansion plans, we have already done our homework, identified the potential locations and sites, have done our market analysis and viability studies, studied the demand-supply gaps and competition and have even got the Techno Economic Viability (TEV) study done by a reputed consultant. "

All these new hospitals would be brownfield projects, whereby the group would take the premises on lease for a span of 15 to 20 years. Says Dr MK Khanduja, Managing Director, BSR Healthcare, "The reason for choosing Brownfield projects is because the investment is low and the gestation period is between six months to a year."

The group is combing the market looking at unfinished malls, which are easily available, thanks to the economic downturn. There are other reasons for selection of malls over any other real estate property. "The ceiling height for a hospital has to be around 4 to 4.5 metre for having medical gases pipelines, HVAC systems, electrical and plumbing lines above the false ceiling. The ceiling heights of malls are similar. Additionally, the column to column distance, also known as span, should preferably be around 6 to 7 metre at least for hospitals, which is also the case with malls, needless to mention that malls also have provision for adequate parking space," adds Naidu.

The investment planned is to the tune of Rs 150 crore (cost of restructuring the building and equipment) for the four hospitals. "We are looking at a mix of debt and equity for investment. We are also exploring the possibility of PE /VC investment against a good valuation," says Dr Khanduja.

The planned projects will be having focus on areas of specialised treatment facilities like cardiology & cardio-thoracic surgery, neurology & neurosurgery, oncosurgery, nephrology & dialysis, orthopaedics and joint replacement surgery, urology, laparoscopic surgery, lithotripsy, gastroenterology, paediatrics/ neo natal, ophthalmology, endocrinology, obstretics & gynaecology, infertility clinic and trauma. Each of this hospital would act as an independent facility with a separate CEO and would be monitored by BSR Healthcare, Bhilai.

In Depth

The state's first comprehensive cancer hospital—BSR Cancer Hospital

From eight diagnostic centres, the group has planned to add 10 more centres

First phase: In the first phase, a 150-bed tertiary care hospital is coming up in Nagpur, a city whose healthcare firmament is defined by players like Orange City Hospital, Care Hospital and Wockhardt Hospital. "We have already identified a property for lease in Nagpur and would soon finalise the property," says Dr Khanduja. The re-construction of the project would start by the end of 2010 and the hospital is likely to be commissioned by 2011. Asked for reasons to choose Nagpur, Naidu states, "The location, infrastructure, connectivity makes Nagpur an attractive location which attracts population from nearby districts like Bhandara, Gondia, Gadchiroli, Chandrapur, Wardha, Amravati, Wardha and also parts of MP like Chindwada etc for availing specialised healthcare services." Nagpur, which is only 280 kilometres from Raipur, is well connected by air, rail and road also and also hosts the winter assembly of Maharashtra.

The first phase would also witness the commissioning of a 70-bed secondary care hospital in Rajnandgaon (CG), which has a population of 12 lakhs. "Due to its location and the fact that it is the first major city of Chhattisgarh on NH 6, it has great scope for secondary care hospital. Being only 25 kilometres from Bhilai, this hospital would also be a feeder centre for Apollo BSR Hospital, Bhilai," says Naidu. This hospital would be commissioned by 2012.

The second phase: A 300-bed tertiary care hospital is planned in Raipur in the second phase. Raipur, which has a population of 30 lakhs (the highest in CG), despite having some medical facilities like Modern Medical Institute, Ramakrishna Care Hospital and Escorts Heart, still has a yawning demand for healthcare. "Raipur is also a good base for a hospital as it attracts population from Mahasamund, Dhamtari, Kanker (Part), Bastar, Dantewada and Raigarh due to its location, connectivity and medical infrastructure," explains Naidu.

Another 70-bed tertiary care hospital in Raigarh would come up in second phase. "Re-construction for this is planned by 2011 and it would be commissioned by 2012," says Naidu. Raigarh, with a population of over 12 lakh, attracts population from Janjgir, Mahasamund, Raipur (part), Jashpur, Sarguja. Additionally, with groups like JINDAL, HIRA,VISA Steel, Ind Synergy and MSP announcing plans of coming up with mega power, steel & cement plants in Raigarh, the expected population boom in this district would serve a good corporate clientele. As of now, there is no single corporate hospital in Raigarh.

Diagnostic Boom

For a group that was founded in 1993 when Dr Khanduja started a diagnostic centre from his garage with just an EEG machine, it is but obvious that the group would strengthen its presence in diagnostic. BSRL, which had a turnover of Rs 11 crore last year and is expected to exceed Rs 14 crore in the current financial year, would now open 10 new diagnostic (with radiology and pathology services) centres in CG and Maharashtra. Spread over Bhilai, Raipur, Nagpur, Rajnandgaon and Korba, it is now coming up with diagnostic centres in Bilaspur, Korba, Raigarh, Jagdalpur, Dhamtari and another centre in Raipur. In Maharashtra, the diagnostic centres are coming up in the Vidharba region — Gondia, Bhandara and another centre in Nagpur. While so far the group has opened only fully-owned and standalone diagnostic centres, for the first time it has tied up with the upcoming 500-bed hospital of Medica Synergie Group in Kolkata for managing their entire radiology department. This imaging centre would have 1.5 Tesla MRI, 16 slice CT, 4D Colour Dopplers, X-Ray with CR System, mammogram etc. "We would be completely managing the hospital radiology department with our equipment, radiologists, technicians, and systems," reveals Dr Khanduja. It will be on a revenue sharing basis.

"The diagnostic centre in Kolkata would be commissioned by February, this year. At least four more diagnostic centres would be commissioned within the next six months," says Naidu. Most of the present and all of the upcoming diagnostic centers are on leased premises. The centres would either be a medium one offering only CT Scan, X-Ray with CR System , Colour Doppler/USG & Pathology or a high-end one with 1.5 Tesla MRI, 64/16 slice Cardiac CT scan, 4D Colour Doppler, super speciality pathology, EEG, ECG, TMT etc. "For medium centres with up to CT scan facility, the cost of setting up the centre could be between Rs 1.5 - Rs 3 crore, and for centres with 0.2T/ 0.35 Tesla MRI and CT etc, the cost would be Rs 3 - Rs 5 crore. It would be much higher for high-end centres with 1.5 Tesla MRI and 64 slice CT scan," says Dr Khanduja. The specifications and selection of the medical equipment and the facility mix will be decided based on the market needs, demand- supply gap and competition analysis.

Other Vertical Growth

The group is also exploring capturing of the outsourcing tele-radiology market in both India and overseas. The tele-radiology division of BSR called 'Progressive Radiology Solutions' has tie-ups with three centres in India and one in the US for this. It is into both preliminary (for the US) as well as final scan reports of X- Ray, CT, MRI scans, 3 D Reconstruction. "At present, we are into preliminary reporting for the US, whereby the report is prepared by us for the hospital, " explains Naidu.

It has installed the latest GE Centricity PACS system and it has HIPPA and HL7 complaint systems. It uses its pool of 10 radiologists across four diagnostic centres for this. "We are also working as a Knowledge Process Outsourcing for tele-radiology reporting of MRI scans/CT Scan and X- Ray reporting for other hospitals/imaging centres in India and abroad as well," adds Naidu.

"For the US market, images are shipped in digital form via V-SAT networks overseas from US hospitals, enabled by a set of open digital imaging standards developed by the American College of Radiology. The radiologists here are certified by the Indian Board of Radiology and also licensed in the particular state/country of the hospital locale where the CT/MR images originate," says Dr Khanduja.

However, tele-radiology is not the primary focus of the group. "In the next five years, we want to have around eight to ten hospitals and 50 diagnostic centres. We want to be a company with a turnover of Rs 500 crore. And soon thereafter, we want to float an IPO to fuel our expansion plans," says Dr Khanduja.

BSR Healthcare has also launched its projects division called 'BSR Projects', which will provide consultancy and management services to doctors and entrepreneurs who are keen to start diagnostic centres with imaging and pathology facilities.

Other Expansions

The 30-bed BSR Cancer Hospital, commissioned in 2001, had a turnover of Rs 3 crore last year and expects to close at Rs 4 crore, this year. The cancer hospital has planned to install a hi-energy linear accelerator and HDR Brachytherapy by 2011. Commissioned in September 2007, the 175-bed Apollo BSR Hospitals in the last financial year closed at Rs 16 crore. This year, it is expected to close with a turnover of Rs 30 crore. Says Dr Sujata Naidu, COO, Apollo BSR Hospitals, "The hospital is preparing to go for NABH soon." With local players spreading their wings, it may not be far that the state would be known not just as the steel, coal and power hub of the country, but also as a medical meccah that offers high quality but low cost healthcare delivery.

rita.dutta@expressindia.com