Ladies and gentlemen, good day, and welcome to the Q1 FY 2024 Earnings Conference Call of Yatharth Hospital & Trauma Care Services Limited, hosted by Ambit Capital. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Prashant Nair from Ambit Capital. Thank you, over to you, Mr. Nair. Thank you, Michelle, and good afternoon, everyone. I am Prashant Nair from Ambit Capital. I welcome you to the Q1 Fiscal 2024 Earnings Conference Call of Yatharth Hospital & Trauma Care Services Limited. From the management, we have with us today Mr. Yatharth Tyagi, Whole-Time Director, Mr. Deepak Kumar Tyagi, President - Strategy and Finance; Mr. Amit Kumar Singh, Group CEO; and Pankaj Prabhakar, CFO. I now hand over the call to Yatharth, for his opening comments and to take it forward. Over to you, Yatharth. Hi, good afternoon, Yatharth Tyagi this side, and a very warm welcome to all of you for the first earning call of Yatharth Hospital & Trauma Care Services Limited, to discuss the business and financial performance of the quarter ended June 30th, 2023. I have with me Mr. Amit Kumar Singh, our Group CEO, Mr. Pankaj Prabhakar, our Group CFO, and Mr. Deepak Kumar Tyagi, our President, Strategy and Finance. I hope you would have had an opportunity to go through our quarterly presentation uploaded on stock exchange websites. We are delighted to report that our listings had an overwhelming response from investors and the overall financial community. This achievement reflects the confidence and the trust that you, our shareholders, have placed in our vision and our potential. We are committed to maintaining the highest standards of transparency, accountability, and communication as we navigate this exciting journey together. As we move forward, we will continue to leverage our strengths, innovate relentlessly, and work collaboratively to capitalize on emerging trends and industry dynamics. Let me take our first earnings call as an opportunity to give you a brief overview about the company and the business model before we move to the quarter's performance and the Q&A. Yatharth Hospitals operate super specialty hospitals in National Capital Region of Delhi and Jhansi-Orchha region of Madhya Pradesh. We are among the top 10 largest private hospitals in Delhi NCR region in terms of number of beds as of March 2023. We started our journey in 2008 with the first hospital in Greater Noida, and since then expanded our presence with hospitals in Noida and Noida Extension. In May 2022, we acquired our fourth hospital in Jhansi-Orchha in Madhya Pradesh, adding 305 beds to our capacity, aimed to expand into new geographies and improve our presence in the regional healthcare market. With this acquisition, our total bed capacity currently stands at 1,405 beds, including 394 critical care beds. Our hospital strength lies in a strong team of 600+ doctors, our clinical excellence spanning across 30 specialties and super specialties, including our 10 centers of excellence. We have achieved financial year 2021-2023, compounded annual growth rate of 51% in revenues to become a INR 5,203 million revenue company. Our profitability has grown at a CAGR of 90% during this period. We are optimistic about our strong growth potential as we build upon our key strengths of diversified specialties, our advanced medical equipment and technology, strong team of medical professionals, and our ongoing expansion initiatives, both organic and inorganic. We have been steadfast in our commitment to expanding our portfolio of high-value specialties. Our journey has been marked by a significant increase in the share of high-value specialties, a testament to our commitment to providing the highest quality of care and addressing the evolving healthcare needs of our patients. I'm happy to declare that our new Jhansi-Orchha unit, which started operations in April 2022, has become operationally breakeven in this quarter. We are committed towards ramping up occupancy at our Jhansi-Orchha unit, while continue to grow all our hospitals through our strategic initiatives and investments. We venture into organ transplant operations, which began in December 2022 and has already yielded remarkable outcomes. The successful completion of 50 kidney transplant surgeries since the inception of the program showcases the dedication of our medical team and the state-of-the-art infra that supports them. We have received necessary approvals for our liver transplant operations and expect the same to start very soon. Our oncology services will consistently push boundaries of research, treatment, and patient-centered care. Our Noida Extension hospital is taking lead by offering a full suite of oncology treatments, including radiation and LINAC for oncology treatments to start in the coming quarters. Our performing lay, our performance lays the groundwork for future expansion, including the potential for organic and inorganic growth opportunities through strategic partnerships and acquisitions. We understand that inorganic growth is not merely about expansion, but also about identifying synergistic opportunities that amplify our strength, extend our reach, and ultimately enable us to serve more patients with exceptional care. Our recent quarter's performance is a testament of a balanced growth approach. We have delivered a strong revenue growth of 39% YoY to INR 1,545 million during quarter one. Our inpatient volumes improved by 14% year-on-year, and our ARPOB has increased to INR 28,140, up 6.4% year-on-year. Noida Extension Hospital recorded the highest ARPOB of around INR 34,000. The OPD consultation tariffs for all our three hospitals in Delhi NCR have been revised recently by approximately 12%. In terms of our key specialties, nephrology and urology, renal sciences registered a growth of 56% year-on-year. Cardiology grew 35% year-on-year, and oncology revenues almost tripled year-on-year during the quarter. Our occupancy was 51% against 40% in Q1, financial year 2023, and 49% in Q4, financial year 2023, with the Noida Hospital reporting highest occupancy level at 92%. Our EBITDA was INR 414 million, up 61% year-on-year, and EBITDA margin at 26.8%, expanding by 368 BPS year-on-year. Our PAT was INR 190 million, up 73% year-on-year. While we focused to grow our revenue and EBITDA, with deleveraging of our balance sheet in this quarter with the proceeds of the IPO, our net profitability and overall balance sheet will emerge significantly strong in the upcoming quarters. With this, I would now like to hand over to our moderator for question and answers. Thank you very much, sir. We will now begin the question and answer session. Anyone who wishes to ask questions may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We'll take the first question from the line of Ankit Jaiswal from Future Growth Spectra. Please go ahead. Hello. Yeah, hi, sir, thank you for your opening statement and congratulations on gaining good% of YoY and QoQ. I have a couple of questions to ask. As I have gone through the presentation that you have shared, I have found that there is at present, there is no international customers in the payer mix, right? What are the company plans to acquire the international payer mix? I guess those are the one of the important drivers of getting the revenues. The second question is, like, in the revenue segment, I have seen that 33% revenue is coming from the medicines, and other is 26%. Can you please elaborate about those two segments? One more question, the occupancy is quite on a consolidated basis, I can see that occupancy is around 51%. What are your future plans to increase the hospital occupancy on a consolidated basis? Thank you. Yeah. Hi, this is Amit Kumar Singh, Group CEO. I would like to take your first question about the international patients. If you look at that, in our previous presentation as well, all these super specialties, be it, you know, transplant program or oncology or even a cardiac and even a highest neurosurgeries and all, which we started and this, or the international patients started coming in our hospital. We have a very solid program for our next two years, that's how this international patients will be entering into it. We have identified the market. Our team is relentlessly, relentlessly working on those areas. We have identified the pockets, various countries. We are signing up with the various agreements with the government, and a good number of patients flow has started coming. In fact, I'll tell you the number of surgeries, kidney transplant, as an example I give you, whatever number of 50 kidney transplant, we have done it, more than 95% of these patients are internationally. We have done a very good surgeries in our onco. We have done very good numbers in, you know, neurosurgeries and other surgeries. It's on a growing phase. Yes, our commitment is the next two years as the Noida unit, which is, you know, very closely coming up with the Noida International Airport (Jewar), which is Asia's largest airport. Our 200-bed facility gonna be completely on the line for the international patients. Our strategies are very much clear, I'm sure that when, when we have our next call for the next quarter, we will give you much better numbers. For next questions, I'll hand over to Yatharth. Hi. As far as your second and third question, you know, you asked about the percentage of medicine. You know, just to clarify here, this medicine represents the Department of Internal Medicine. You know, it is not pharma drugs. The Department of Internal Medicine, what it means, it means that, you know, it, the treatment of lifestyle diseases like, you know, diabetes, cough, cold, fever, dengue, you know, this is what this department comprises, which has physician doctors. The share is roughly around 33%, for this, you know, quarter. As far as your question on what others, as you would have seen, so what others mean. You know, if you look at the Q1 financial 2023 and Q1 financial 2024 breakup of the pie chart that we've also provided in the presentation, others signify, you know, few departments, and these includes pediatrics, gynecology, gastroenterology, pulmonology, oncology, and organ transplant. You know, I mean, if you, if I want to break up for the latest quarter, you know, pediatrics is roughly around 4%, gyne is around 4%, gastro is around 2%, pulmo is around 4%, onco is around 1%, and, you know, similarly, onco is around 3%, and organ transplant is around 1%. This is the breakup of the others. Now, coming to your second question on the occupancy. Occupancy, yes, you know, in the overall group level, it seems 51%, but that is because two of our hospitals have recently started. The Jhansi-Orchha Hospital that, you know, started complete operations in last fiscal year. It was its first year of operation, and that is why the occupancy is less in the first year. In the latest quarter, compare on year-on-year basis, we've almost doubled our occupancy for Jhansi-Orchha Hospital. I'm sure in the coming quarters, both Jhansi-Orchha Hospital as well as Noida Extension Hospital will, you know, mature much more in occupancy. At a group level, at a consolidated level, I think we will able to see their impact in the coming quarters on how the overall occupancy increases at that. Thank you for answering all the questions. One last question from me. Is there any doctor equity participation method that you follow, or what is the plan to retain the doctors? Right now, we don't have any equity that is held by our doctors. You know, as far as, you know, retention of our doctors, you know, that is something we will consider in the coming quarters. As of now, I think, you know, the attrition in senior doctors, that is super specialty doctors, is anyways quite less in our hospital. I think going forward, I think the retention would continue to be strong because of the DNB courses that are also coming up in our hospital, as well as, you know, the departments increasing. It gives doctors a good clientele, and that's why they're able to stick with us for a long time. Yes, as far as doctor equity is concerned, that is something we will consider in the coming time. Okay. Thank you. Thank you. We'll take the next question from the line of Reshab Sisodiya from Sameeksha Capital. Please go ahead. Hello, am I audible, sir? Yes, sir. Please proceed. Yeah, hi, sir. Thank you for the opportunity, and congrats on a good set of numbers. I have a few questions. If I look at your ARPP, like, Average Revenue Per Patient, it has gone up almost 20%-23% on a YoY basis. How much of this would be due to change in case mix versus any price hikes that we have taken? I think, the price hike that has happened recently is more on the OPD front. As far as the IPDs are concerned, I mean, at the overall level, that is, you know, not much has been there to significantly contribute to the, you know, ARPOB. It is happening because of the case mix, you know. As you see now, we're doing a high share, oncology department, you know, has grown on year-on-year basis. You know, in fact, our organ transplant department has recently started, plus other, you know, high-end super specialties, which we are able to do. In fact, neurosurgery is, you know, another department that in terms of volume, you know, has grown as far as the neurology. This is what is contributing to the increase in the ARPOB and not just the price hike. Okay, fine. That's good. Because of higher transplant patients and onco and other specialties, that is one of the reasons for your increase in ALOS as well? Yes. Currently we are at 50%-51% occupancy, as you mentioned, and almost 4.5 days of ALOS. Where, at what point do you see, like, after reaching, let's say, 60% occupancy, your ALOS should start in reducing, and that would increase onto it? Sorry, your question on the occupancy of 30%, I didn't understand that. Which hospital are you talking about, or are you talking about the group level? Yeah. I'm looking at a group basis, 51%- Yes. ALOS is almost 4.6. At what level of occupancy do you think your ALOS can start reducing after reaching 60%, 65%? Suppose that you can have better volume as well as margins. I think, see, if you look at it, as long as we are maintaining this ALOS 4 - 4.5, I think it's absolutely fine. We are okay with it. We are not intending to reduce it, absolutely. If you look at it, we are very much into the line, even increasing the super specialty, I think we will be into this because, you know, the, the other specialties will, we think that's slightly reduced. I think anything between 4, 4.5, 4.6, still is a very good ALOS, and management has no intent to reduce further. If you maintain this, I think it's absolutely fine with us, with a higher, you know, occupancy as well. ... Okay, sure, sir, that is helpful. One last bookkeeping question: If you could just share the census bed on each hospital basis and also the volumes for each hospital for the quarter? I, I think for that, you know, this is Deepak carrying this, right? I think for that, you should see our slide deck we have already, you know, provided. If you want, you know, the occupancy, you know, the Noida is better, you know, it's around 90%. Greater Noida is around 65% if I'm not mistaken, 66%. You know, Noida Extension is around 36%, and Jhansi is around 17%. I know we are already providing detail, the detailed number of our IP volumes and OP volumes and the revenue respectively by the hospital. I request if you can, you know, have it from the, you know, presentation we have provided. Okay, sure, sir. One last thing, any CapEx guidance for the year and our debt repayment that we have done in the quarter or we'll be doing next? CapEx, you know, we have already, you know, stated our intentions and plans in the IPO statement. We will be doing around INR 132 crore of, you know, CapEx in, you know, out of the IPO proceeds. We are working very fast to deploy these, you know, this amount so that it can, you know, fruitfully be invested back into the business. We will be doing that. What was your next question? About that,... Yes, question on the loan repayment. Yes, you know, we have repaid our existing bank debt. You know, long-term and short-term borrowings have already been done, you know, so, you will see the results in the public in the coming quarters. Okay, sure, sir. Thank you. That's it from my side. Thank you. Participants who wishes to ask questions may press star and one now. We'll take the next question from the line of Ankur Kumar from Alpha Capital. Please go ahead. Yeah. thank you for taking my question. My sir, first question is on our Greater Noida is the oldest facility, but it has lower utilization in terms of 65%. any thought on why is it lower than our Noida facility and any thoughts on improving that? You know, if you look at it, Greater Noida seems older. However, you have to look into the account that in 2018 is where we expanded this hospital from a 100-bedded hospital to a 400-bedded hospital. The story of Greater Noida actually starts from 2018. That means Noida Hospital, because that started in 2013 with 250 beds, and that's what it is right now. Noida, in that aspect, is an older hospital, and Greater Noida, starting 2018, is moving towards the maturity now. Got it. Got it, sir. Sir, on CNBC also, you were giving the interview that you're expecting 60% occupancies also, and call also you're talking about possibility of 60%. You think we can achieve that 60% in this year? I think, you know, the management is hands-on to, you know, work towards it. Maybe it's achievable at the end of this fiscal, you know, it's to be seen. You know, our plans is quite strong. You know, as you can see, we have also, you know, had a decent occupancy jump both year-on-year and quarter-on-quarter basis. Let's see, you know, that how, how that goes for the fiscal year when this ends. Got it, sir. Sir, any, any thoughts on new acquisition? What is any target area that we are looking at? And in terms of bed also, anything we are specifically, specifically looking at? you know, we are looking to expand both organic and inorganic. As far as organic expansion is concerned, both our Greater Noida Hospital, you know, we have acquired the adjacent land parcel, and we are expanding that hospital, from, you know, 400 bedded to around 600 bedded. Noida Extension Hospital also, which is a 450 bedded, you know, we were recently the highest bidder, the adjacent land parcel behind this hospital. you know, we also look to expand this hospital to around, you know, 250 beds more, so around 700 beds. That is the organic expansion. As far as inorganic expansion is concerned, you know, we are actively, you know, looking out for opportunities, and very soon, you know, we'll be able to finalize few opportunities. We want to, and right now, look in the areas that are, you know, North India. Not just restrict ourselves to Delhi, market. We want to, you know, we are looking for opportunities across Uttar Pradesh, Haryana, Punjab, Madhya Pradesh, you know, so, so, so that's where the, the acquisitions should come in the coming time. Got it, sir. Sir, in PPT, we're talking that our material and consumers are lesser than peers. Can you comment why is that so? On margins, is it, is the current 27% are sustainable? See, you know, material and consumption, you know, this has traditionally been lower to us because, we at ours, you know, provide, the management provides deep insights into, and, you know, there are. One of our directors is very, very focused on, the acquisition or be it a capital acquisition or be it the, you know, operational expenditure, and that we continue. That's around 18%-19%. We remain normally on our, you know, top line. We expect that same to continue in the future years to come as well. Yeah, also along with the material consumption, you know, your question on how that contributes to higher profitability. You have to see the, look at the fact that our manpower, you know, cost, that is both, you know, if you add the doctors and the, non-doctors, that is the admin, is, you know, lesser. That also contributes to our, you know, our profitability, because, you know, we have not outsourced a lot of our support services. Whether it be housekeeping, GB, and all these facility management, we keep in-house, so, you know, we save on the service, charge to the vendor as well as the, service tax. That is also, you know, contributing, to our profitability. Answering your question, how we are able to achieve a higher profitability? Got it, sir. Thank you, and I'll get back to you. Thank you. Thank you. Participants who wishes to ask questions may press star and 1. We'll take the next question from the line of Dhara Patwa from SMIFS Limited. Please go ahead. Thank you, sir, congratulations on good set of numbers. I have two questions: First is, since 37% of our revenue comes from government business, which is quite higher compared to the peers, I believe there is limited scope for price hike. What could be the growth drivers to grow the ARPOB further from INR 30,000 and year on? Second question is, Noida as a location has, you know, usually command higher ARPOB to the tune of INR 45,000-INR 60,000, but we have 60% lower ARPOB than our peers. Can you explain this, and how can we grow this further? You know, our ARPOB will grow, and that will happen both from pricing as well as the case mix. You know, regardless of the percentage of the government business, you know, our cash rate as well as health insurances rate, that is the TPAs, you know, they undergo, you know, yearly revision, and that will contribute to the ARPOB. However, bigger growth will come from the case mix, as you know, that we have seen on year-on basis. As soon as, you know, we offer the complete spectrum of oncology services, you know, this ARPOB is bound to increase. Right now, we are only doing medical and surgical oncology. Our radiation oncology is, you know, about to start in the coming quarter. Once that starts, only then we become a complete oncology center, and patients prefer to come into one-stop solution for all oncology. Oncology, coming up will definitely increase our ARPOB as well as, you know, when the case, when the contribution of international patients will rise, ARPOB will also increase from that. You know, as already our CEO was mentioning, that we are closest to the Asia's largest international airport that is about to start in Greater Noida, somewhere around next year. We are quite strong on international patients numbers in the coming time, and I think that will be a huge contributor to our ARPOB. Secondly, your question in, you know, the territory of Noida and why our ARPOB has been traditionally lesser. That is again, you know, if I reverse these points, I said two reasons. First, when we started our chain, you know, all those years back, we intentionally kept our pricing lesser. You know, we were around, 15%-20% cheaper from the likes of, you know, other hospitals that were in Noida, the super specialty, big chain. Second reason for ARPOB being lesser was the case mix. Because we don't have, you know, robotic surgery, because we don't have oncology in high proportion and international share. That is why the ARPOB was lesser. Actually, if you look at now, especially if you look at the case of a Noida Extension Hospital, which is, you know, doing around INR 24,000 of ARPOB, that is because the mix of super specialty services is higher in this hospital, leading to a, a higher ARPOB. With over the coming quarters, when the share of, you know, internal medicine will come down and these super specialty services increases, that will contribute largely to an increase in ARPOB. Okay, understood, sir. Sir, one last question was, like, there are a lot of peers which are expanding in Delhi NCR region. Like, one such example is Medanta coming up with 550-bed capacity in Noida, and even Max Healthcare is expanding their operations in Delhi NCR region. How do you see this competition? Do you think that ARPOB levels and our occupancy levels will still be maintained post this competition? Yes, in fact, you know, we are also expanding, you know, in, in our existing hospitals. By the time, as you mentioned, Medanta or other hospitals that they enter, Noida, in, you know, we-- two of our hospitals, Greater Noida and Noida Extension, are already among the top 10 largest private hospitals of Delhi NCR in terms of number of beds. With these expansion of, you know, around 600 beds and around 700-bedded hospital of Noida Extension, we will be among probably top five, top four, largest hospitals in terms of number of beds. You know, we have had this strategy of, you know, using economies of scale, and we believe in the territories where we operate to be, you know, the biggest, hospital in terms of number of beds. So far, we are able to do that, you know, and, and going forward, we will continue to maintain that. You know, at the same point of time, even if there's more competition come, these cities are growing, you know, cities. The likes of Greater Noida and Noida, population is growing year-on-year, especially with the coming up of the airport. You know, these are still far from being saturated. We feel, our occupancy will continue to rise, no matter how, how much the competition comes. Okay, that's it from my side. That's helpful. Thank you. Thank you. We'll take the next question from the line of Deepak Poddar from Sapphire Capital. Please go ahead. Hello. Yeah, thank you very much, sir, for the opportunity. First up, I just wanted to understand now in terms of acquisition, you mentioned, so, so what's the ticker size we are looking at, in terms of acquisition target? You know, we are looking for on both levels. We are also looking for O&M model, as well as we are looking to complete a 100% equity purchase. You know, as far as the number of the size of these hospitals are concerned, we will be looking to acquire, you know, hospitals which are at least 300-400 bedded in size. You know, we are not going for, you know, small hospitals, because our, all our hospitals are, you know, considered big super specialty hospitals, and that's what we will continue to grow further. We already have, you know, a decent amount from the primary IPO reserve for acquisition funding. You know, that's where the acquisition will come from, and 300-400 bed size hospital is what we will be, looking to acquire, both on O&M as well as, you know, 100% equity purchase. In terms of INR grow, what is the range that we are looking to spend in the acquisition? See, it all depends, you know, as Yatharth just mentioned, that what is the bed size, and it depends on the location. It would be difficult, you know, you know, without having complete deal in our hand to ascribe to any amount. It's better to go by the size, and then we see that, you know, what the geographical location and what kind of facility are we providing. The price range can, you know, vary. You can imagine the real estate pricing, so it would not be proper on our part to provide any price commitment at this point in time. No, no. What I was trying to understand more on the front, ki, what is the maximum amount that you are willing to spend on the acquisition front? Because INR 500 crore... You know, if, if you ask the per bed cost, you know, all told, it would be anywhere between INR 60 lakh to INR 75 lakh or INR 80 lakh kind of, you know, pricing we are expecting. You know, that's a very wide range I am providing because as I said, that, you know, it all depends on the size, the location, the facility and all these. Understood. maybe what INR 200 crore-INR 300 crore is the maximum that we might look at in terms of acquisition size? Yes, if it's a 100%, equity purchase. On 100% equity. Understood. Fair enough. We have paid this INR 250 crore-INR 260 crore debt, right? That we had on our balance sheet out of the IPO proceeds of INR 500 crore. Yes, we have already done that. So that INR 6 crore interest cost that used to come will not come now and so forth. Yes, it will not. Okay, fair enough. Sir, I mean, I was going through your presentation as well as your remarks. I mean, we are focusing towards more high-value specialties, right? Even the full suite of oncology treatment, and we do expect a higher occupancy in Noida Extension, as well as in your Jhansi hospital. That effectively means a better fixed cost absorption. Ideally, ideally, what's, what's the margin aspiration we would have, right? Because currently only we are doing around 26%-27% kind of EBITDA margin. Now all these three things happening, our EBITDA margin aspiration or potential should be much higher, right? Sir, you are so right, but I'm not giving any guidance to you as to, you know, what are EBITDA margins in future to come. We are 26% in this quarter. We expect, because we have already mentioned that Jhansi has become operationally, you know, operationally EBITDA positive in this quarter, though marginally. With a better revenue line coming on, you know, Jhansi and contribution coming from all the hospitals, this EBITDA margin would go up, you know, instantly in, in, in the recent quarters to come. I would say that, you know, by March 2024, you would see better results than what we are showing now. Mm-hmm. Mm-hmm. Mm-hmm. I mean, aspirationally, at least 30% plus, is that something we can target? I don't know. I, I would not, I would not ascribe to that. That's, that way forward. We have our plans, you know, we, we believe in going steadfast, so I'm not giving, giving any 30% or, you know, any percentage to you as of now. Understood. Fair enough. I understood. In terms of expansion, you mentioned couple of expansion, right? In Noida, as well as Noida Extension. By when we are looking to complete that? That is in Greater Noida hospital and Noida Extension Hospital. I think very soon we are about to start the construction, and I think roughly it would take, I think, three years for the complete, you know, hospital to start. Mm-hmm. Okay. two to three years, I think roughly, I think we've seen that. Greater Noida will start much faster because of the... You know, Noida Extension will start few months later after that. Right. Right. Right, right. And, and my, my final query is on your re- revenue. I mean, I mean, last three years, we have seen a very good CAGR, right, in terms of more than 50%. Any sort of CAGR you might look at for next two, three years? Any, any outlook that you would like to provide? I think, again, we will not be providing any specific guidance on the number of, the, the exact number, but I think as, as we would have seen from the, Q1 results, we will continue to grow in a very good fashion, and that's what all the targets are. Oh, that's great. That's great. Okay, that's very helpful, sir. I think, that's about it from my side. All the very best. Thank you. Thank you. A reminder to all the participants, anyone who wishes to ask questions, may press star and one now. We'll take the next question from the line of Reshab Sisodiya from Sameeksha Capital. Please go ahead. Yes, sir. Sir, I would request you to kindly rejoin the queue. Once you rejoin- Yes. I'll take your question. Okay. Okay? Thank you. Yeah. We'll move on to the next question, which is from the line of Hitin Boreja from Sequent Investments. Please go ahead. Yeah. Yeah, thank you. Thank you for the opportunity, sir. Actually, you gave some numbers related to CapEx of INR 132 crore, which we are going to spend on, two of your hospitals. Can you please repeat it? I just missed the number. What is the exact number of beds we are adding? No, this CapEx that we mentioned, you know, around INR 130 crore, this is the CapEx that will go into buying of medical equipments for all of four hospitals. This is not the CapEx that will be utilized for the expansion of the bed capacity of Greater Noida and Noida Extension. You know, around INR 133 crore is what we, you know, have raised from the IPO, which will be used to buy new medical equipments. For example, you know, we are adding oncology machines like PET scan, LINAC. We are buying robots. We are buying, you know, surgical robots. We are also buying orthopedic robots. That is what this CapEx comprises of. Okay, thanks for the clarity. You also mentioned related to expansion, addition of our beds into hospital. What are we spending there? We are expanding, you know, at Greater Noida from 400 bed to 600. That's our plan is. ... at Noida Extension, which where we have been declared the highest bidder, we will be expanding our capacity from 250 bed to 700 beds. You know, the cost of these expansion is not there in the, you know, IPO money. This we will be making out of our internal approvals and the money we are going to save from, you know, the debt service, which otherwise would have gone, now we are saving because of the repayment of debts. This is eventually going to expand over, over the period of three years, right? Yeah, that will be. That will be the, you know, accumulating our cash and spending it, accordingly. Okay. Okay, sir. Okay, one quickly bookkeeping question: What's the current cash and debt as of today? Because I heard you have repaid all the debt, so there is no debt. What's the cash in the books now? Cash, you know, if you ask me immediately, you know, I need to check, but that would be roughly in the range, roughly in the range. Today sitting here, it would be in the range of around INR 5 crore after paying... You know, and I'm not including the, you know, the IPO money, which we have otherwise lying in our bank, but I'm talking about the current account of the company, out of which INR 255 crore debt we had in June. Out of that, INR 245 crore we have paid. There is hardly any debt left, very small amounts of debt that would have been left now. Okay, okay, okay. No, thank you for that. IPO, you know, IPO money, you know, for the, you know, acquisition reasons like, you know, the general corporate purpose and unidentified acquisition, all these money are, you know, lying separate. We are not touching them. We have not touched them as of now. Can you quantify that? It could be around INR 65 crore of, you know, unidentified, unidentified acquisition, around INR 140 crore-145 crore of, you know, GC, lying there, and then some amount lying for the expense account, to the tune of around INR 15 crore-INR 20 crore, you know, which we will be utilizing post, meeting our, all IPO expenses, which we are making as of now. Okay, okay. Thank you. Thank you, sir. Thank you. You may press star and one to ask questions at this time. We'll take the next question from the line of Amit Jeswani from Stallion Asset. Please go ahead. Hi, good afternoon. I just wanted to understand what would be the ROIC or the payback period on the INR 132 crore CapEx that we are doing? That's my first question. Did you ask about ROCE or-? Yeah, right. Yeah, it, it's okay. You can say anything. See, we are looking... You know, it would be difficult to make out the separate ROI for it. I would be better call it that, you know, what would be the payback of these, you know, thing. I expect the payback for this investment to be in the range of around two to thres years. This is one thing, you know, it's not maintenance CapEx, it's enhanced CapEx, but major most of it is going on to the oncology around, you know, INR 60 crore-INR 65 crore of the amount going into oncologies and robotic surgery and all these things. I expect that overall investment of INR 132 crore will be paid back in two to three years' time. Got it. Got it. That would mean about INR 40 crore- INR 50 crore a year. Just trying to understand, our profits were about INR 66 crore last year. The debt, we paid INR 24 crore as interest. That would mean that our pre-tax profit, sorry, our pre-tax profit was INR 88 crore last year, now we will not have to pay any interest, of course. We might get some other income. We'll have INR 24 crore added to the PBT level. You're saying, we make about INR 50 crore extra, INR 45 crore-INR 50 crore extra per year on the INR 132 crore equipment investment. Did I get that right? You are right on the, you know, analysis part, but I, you know, I mentioned that it would be payback period, so may not materialize anything and everything in 2024. It could come in 2025 and 2026, in a phased manner as well. Got it. It would, it would come, you know, the, you know, it would, it would come in the form of higher ARPOB, higher EBITDA, higher revenue, revenues coming in. Yes, you know, resulting into the better PAT, which at this point of time, we are at around 12%. I'm not giving any guidance, but you can make out that with these things coming in, you know, better PAT is expected. Got it. This doesn't include the new CapEx for the existing hospitals that we are increasing our bed, bed capacity. What kind of CapEx should we expect there, and why will that? So that we are already at very high capacity utilization in one of our hospital, 90% odd, 80%-90%. Should we expect that CapEx to start this year itself? Oh, yes. You know, this, you know, the CapEx is two facets, Amit. One is that what the CapEx we sought in the IPO, so that's around INR 132 crore. A good lot of portion would be utilized in this fiscal itself. You know, some portion, basically Jhansi radiation set, you know, will be utilized in the coming year. The second set of expansion, second set of CapEx would be, which will be in the CapEx kind of things, which Vijay just mentioned, that it would be in the form of expansion at our current hospital. That would be coming. As far as the ticket size of the new capacity which we are adding, I had already indicated, that it would be in the range of around INR 60 lakh-INR 75 lakh per bed kind of thing. Got it. You said you've increased your, the prices of, surgeries and operations by 12%. That was done after this quarter? No, just to correct you there, the 12% increase was the OPD prices. You know, just that is just consultations, outpatient department consultations, and that was, you know, somewhere at the start of this quarter. Sorry. Got it. Got it. Got it. Our goal, as I'm understanding, would be whatever cash we generate, we would keep reinvesting across a cluster base of approach in North India. With every passing year, our average revenue per occupied bed should keep increasing from, like, assuming we're at INR 26,000 last year. That number, do you have a target in mind that in next two, three years, this number should be INR 35,000, INR 40,000, something like that? See, ARPO will increase, but we have not taken a specific target as to how much, you know. That is something I cannot share. However, you know, in one of our hospitals, that in Noida Extension Hospital, if you see the ARPO is already INR 34,000. We expect the ARPO here to, you know, increase sharply post the oncology services. Yes, that will overall group ARPO will continue to rise in the coming years. At, at worst, I know you're not giving future, looking statements, but this 27% EBITDA margin is a sustainable number, and there will not be any large deviations to this. It probably will go higher, but at least this number is a sustainable number, right? Yes, we. We increase it to go a bit higher, and it will continue to sustain. Because, you know, our growth is coming from, also from our organically. That is, you know, our existing hospitals will grow in occupancy. EBITDA margins, you know, will be sustainable. Got it. How do you retain doctors? What is that thing that works best for Yatharth to retain doctors? You know, the promoters, Dr. Ajay Kumar, Dr. Kapil Kumar, you know, they themselves are, you know, medical profession from, you know... This understanding and thought process of a medical profession is very embedded in our management. You know, doctors relate to our management a lot. You know, we are not a corporate that give targets and specific, you know, numbers to doctors, that this is how much is expected from you. We let them practice in a, you know, in a medical, ethical and a very transparent way. You know, also, if you see the growth in terms of our IPD growth volumes that have happened over the course of last two to three years, the doctors who joined our hospitals, you know, they have also grown a lot in terms of their patient clientage. You know, so now they have a huge clientage because of, you know, the clientage that came to Yatharth. You know, they're able to, you know, be with us for a long time because our doctors are also growing, not just the hospital. You know, that's why they are with us for a long time, and we also engage them in a lot of, you know, internal programs, like various, you know, conferences, as well as, you know, patient engagement. That's why, you know, the doctors are involved in every decision-making. It's not that, you know, they're just involved in the patient care. Even if some medical equipment are to be finalized, if some new department infra has to be changed, we really involve the doctors. We really empower them, and that's why they have a bigger say at Yatharth Hospital. That's why they are with us, they are with us for a long time. My best wishes to you, Yatharth, and the team. Thank you so much. I'll be in touch. Thank you. Before we take the next question, a reminder to all the participants, anyone who wishes to ask questions may press star and one now. We'll take the next question from the line of Ashil Shah from CJ Shah. Please go ahead. Yeah. Hi, good morning. A couple of questions here. What would be the margins that we hit in the Noida hospital? you know, we are not giving any specific guidance, hospital-wise. Say again? Existing margins at Noida hospital. Oh, Noida and Greater Noida put together, you can say, though I'm not giving any specific number, but that would be in the range of around 28%. That's the answer I am giving, you know. Does, does, does this answer you? I mean, yeah, that, that definitely helps. This Noida, Greater Noida does not include Noida Extension? No, no. Noida Extension is a different hospital. Okay. Do we feel that the other hospitals, which is your Jhansi and Noida Extension, can come on a standalone basis, come closer to these margins? Or is there some difference in, you know, payer mix and case mix, which is why they might be, you know, inherently lower margin even after all? You know, payer mix is not different, but, you know, definitely there would be a case mix. You know, the margins at the respective hospital would be different. We expect Noida Extension being rich on robotic, oncology and, you know, organ transplant, will be doing far better in the coming years to come. So is the Greater Noida. Noida, you know, traditionally had been doing and, you know, it would continue to, to, to do that. Jhansi is a different price segment. It's a new hospital, so marginally, on a margin side, you know, it will come to its side. So, that is the case, basically. Got it. As of, as on today, you know, without giving specific numbers, would Noida Extension be a higher margin than Noida, Greater Noida already, or that is eventually? At this point of time, you know, our Noida regional hospital are almost at par. In future, we expect that Noida Extension would contribute better. Okay, got it. Fair enough. Compared to a Medanta, Max, and, you know, the other guys who are expanding there, our ARPOB is lower. Just wanted to know, for the similar kind of treatment, let's say, for some, oncology-related treatment or some surgical treatment, our, our cost of treatment is similar to theirs, or is it, you know, lower in general? ... It is a bit lower. I think, if I put a rough estimation, it would be around 15%-20% cheaper, from the likes of the hospital that you just mentioned. Got it. Got it. Is this, do we expect to keep, like, let's say that their pricing goes down, do we expect to keep matching it or, by continuing to be 15%-20% lower, or how do we look at that? No, I think, regardless of, you know, what our competitive prices are, our existing prices will, you know, see an yearly increment of, you know, a few bits of% and that's what we will be focusing on. Got it. Last question on the, Jhansi as well as Noida Extension part. As we go up in occupancy, are we also looking to have more doctors and nurses and, you know, the variable costs will increase, or, have you already done that, you know, employees, how many ever we need, we have them ready already? Majority of the cost has already been incurred and, you know, is already there. You know, when the occupancy increases, some only a few handful of, you know, nurses are required. Just in doctors, if I talk about, so mostly the resident medical officers that are required. The specialists and the super specialist doctors are already there and already hired. You know, so we don't see much incidence of cost when the occupancy increases in these hospitals. Got it. Sorry, one question I missed. Any reason for the margin to be going down, you know, before IPO, I think it went down by a couple of basis points each year? What was the reason for that? You know, those were the COVID years. You know, in COVID, the margins were higher because of, you know, we had a lot of the fixed cost was less, and there were high patient volumes. That is the reason for the margins high at that time. Even post that, you know, just 1% or 2%, you know, post-COVID is, is, is it, and it's been maintained now. Though these we consider a good, you know, healthy margins, and that's what has been typically the case with the company for very long. You know, since the inception of the company, we have always been a bit of positive. We have always maintained healthy margins, and that's what the case is. Understood. Thanks a lot for taking out the time. This is very helpful. We'll take the next question from the line of Huseain Bharuchwala from Carnelian Asset Management. Please go ahead. Hello. Yes. Am I audible? Yes. Hi, yeah, good quarter from there, congratulations for that. Just one question I just wanted to understand. On the Jhansi-Orchha, where we have 8% occupancy currently, how do you plan to ramp up? How do you expect the ramp-up to happen? When can we expect the utilization to reach to our as high as 60% utilization, which would happen in the like four years or, how, how are you planning to do it? Is there something that we have, some idea, some thoughts on that? Okay. Yeah. Yeah. So, you know, Jhansi-Orchha is a very important hospital for us. You know, the reason it will not take that much time for occupancy to ramp up. You said three, four years, we expect that to be much, much faster than that. You know, typically, when a hospital starts, the first year of operation, you know, it goes into getting all the licenses, including the legal licenses, and then NABH happens, and then that's where you get all the empowerment, including the healthcare insurances, including the government empowerment. So that's where, you know, the first year went for this hospital. And now I think a lot of these empowerments are already there, and yet we are awaiting two, three key empowerment. As soon as these, you know, empowerments happen, we expect that to a major contribution should come as far as the occupancy is concerned. Also, another reason for, you know, we expect the occupancy to ramp up soon there, is now all the departments are complete with all the doctors. You know, in the first year, especially in a hospital which is around 450 kilometers away from Delhi NCR, it takes time to get all the super specialty doctors. As of today, now most of the departments are complete with all the doctors. I think that will also contribute in the coming quarter for a good occupancy contribution. It, it, the occupancy should ramp up there very soon because of these two key factors. Got it. Got it, got it. I think most of my questions were already answered, so this was only one. Thank you. Thank you, sir. Thank you. Thank you. We'll take the next question from the line of Manoj Shroff from Keva Advisors. Please go ahead. Sure. I want to know about the attrition. If you can update us on the, on the senior doctor attrition and the overall doctor attrition and the other support staff attrition as well. If you can give us comparison, I think it was there in the prospectus. If you can share, what is it now? Any plans, how will we bring it down? You know, on attrition part, Manoj, you know, the most important thing is that you know, how our key doctors, the doctors who basically drive our volumes and business, that attrition has already come down below 9%. That is one part. We are, you know, with this DNB program coming in, we expect that our other junior doctors attrition will also come down because that will be providing them long-term, you know, engagement. The other important, you know, attrition, which worries ourselves is the nursing attrition. You know, nursing industry-wide, it's a problem, but now we have, you know, with the engagement coming in, so this number is also coming down quite fast. These are the important numbers which really affects our business. As far as the other attrition in the terms of our group four employees, so that attrition, yes, it's high, but, you know, because they are not, not that, you know, we are, we are not, recognizing their contribution, they are important, but, you know, this over a period of time will come down, with a better brand equity and better, job, prospects we are going to find. Sure, sir. Sir, if I can just go on, on this one. In the, in January 2022, in the July prospectus 2022, we had said that our overall doctor attrition was 65.7%. Can we share how much is it now? As I said that, you know, you know, important is, you know, I just mentioned that how our key doctors are retri- you know, retiring. That is below 10%. As far as other doctors, you know, the 65%, what we had stated in our DRHP was inclusive of both our key doctors and the junior, junior doctors. Junior doctors attrition, as I mentioned, that, you know, with the DNB program coming in, which we've already started at Noida Extension and Greater Noida, and soon will start at Noida as well, for which the formalities are on the way. This attrition will also come down. I am hoping, I'm hoping, I'm not putting any figure, because that's not in my hand, but that would come substantially lower than what we had stated in DRHP at that point of time. Because that was the time when COVID was also, you know, slapping us, and doctors and other medical professionals were in demand. This year, that basically fiscal 2024, would be our normal year from that attrition point of view, and that will come down substantially. May I see right now, say in Q1 or the last couple of quarters, it is yet at 65%? You know, I'm not putting any figures because, you know, we had not computed that way. I'm not putting any figure because the figures are not with me as of now. Got it. We might publish it in the Q2 earnings, but not for Q1 at this point in time. Got it. Sir, one more thing, in the Medanta and Max Healthcare, as you said, our pricing is 15%-20% lower, their ARPOB is INR 60,000 and INR 70,000, and our ARPOB in Noida is INR 34. The gap seems much higher for any other reason as well? Yeah, that is because of our case mix, you know, and our, you know, as now we are maturing towards a hospital, which, you know, in coming time will contribute more from super specialty. You know, we don't have international clientele so far in the tunes of what they have. You know, yet we are, we are starting to grow now on our international clienteles, as well as, you know, robotic surgeries. These three things combined, you know, are a big reason for our ARPOB being lesser. I think in coming years, you know, once we start all these three aspects and they contribute into bigger volumes in overall, I think our ARPOB will be, you know, somewhere closer. Got it. That's fantastic. Sir, the margins you mentioned, even at such a low ARPO comparatively, our margins are in, in fact, much better or equal to them. I think you mentioned one of the reasons was, I think, support staff, et cetera. Any, anything other strong reason you can share, sir? You know, the margins are basically sum total of, you know, how we, you know, effectively use our manpower. That is basically our doctors, because that goes into the specialty charges, then comes to employee costs. Then if you see our, you know, consumption of material also. They are also, you know, lower as comparatively. These are the factors basically because anything and everything, you know, because we are very hands-on on anything and everything. Mr. Amit Singh, or for that matter, Dr. Ajay, Dr. Patel, you know, anybody and everybody, you know, basically puts his effort to see that every cent what we are spending is utilized better. That contributes to our, you know, margins. That is the reason that why, you know, our ARPOB, which is, which is, you know, a bit lower, I would say substantially lower when we see, you know, as to the likes of, you know, the top notches, are still, still better than what the industry peers show us. Sir, just one last question. The nearest hospital to our catchment area in the branded national brand, I believe, is Fortis, if I'm not wrong. Is that right, sir? Yes, that's right. Fortis is there in Noida. Fortis is also there in Greater Noida. Right. Right. How much is our pricing lower to that Fortis there? Will it be in the same 50% - 20% range? Yeah, roughly in that tune, what we mentioned. Okay, because Fortis margins are also significantly lower than ours. I was just wondering, how do we win and do much better than them in occupancy there in that, in that catchment? Can you repeat your first part of the question? Your voice was a bit lesser. My question was, how do we manage to get more occupancy versus Fortis in that particular, in that particular area? Anything, basically, how are we... how is our brand better or our team? You know, two, three key factors on why, you know, patients in our locality are choosing us over the national brand. You know, first, the key factor is, you know, infrastructure. You know, two of our hospitals, that is the Greater Noida, which we renovated in 2018, and Noida Extension, you know, with that start in 2019. These are pretty brand-new hospitals, which are, you know, at par with any India's healthcare inside concern, you know, and whether it be a room, whether it be the patient waiting area, you know, so patients get that at a price which is 15%-20% cheaper. That's A. B is, you know, in the territories of, for example, in Greater Noida, and for example, in Noida Extension, we really had an early mover advantage. you know, so, so our brand is very strong in these areas. Also, you know, if you look at the overall Noida and Greater Noida territory. People perceive Yatharth as a brand with around 1,000 beds, you know, in this territory. We are just one of the biggest players, and that's why we're able to cater to a lot of large volumes. you know, our doctors, you know, our e-doctors are the ones that, that have really become brands in these areas, and, and people are coming and choosing us, you know. Another, a big thing happened with us is, you know, during COVID, you know, Yatharth, was one of the biggest, private COVID players in the region. You know, the, the patient experience that the patients had during COVID, the word of mouth that spread. You know, post-COVID, it has really, really helped us, and it has really helped in the post-COVID numbers. You see now people have seen our latest infrastructure. They have seen a really good patient care, you know, experience. The word of mouth has really spread across this region, which is, you know, helping us to attract even higher volumes of patients. Sir, thank you so much for patiently answering. Thank you so much and all the best. Thank you. Ladies and gentlemen, this will be the last question for today, which is from the line of Ankit Jaiswal from Future Growth Spectra. Please go ahead. Yeah, thank you, for taking my question again. I have one major question regarding the hiring process of the doctors. Like, other hospitals have a plan to plan of hiring the doctors from their attached medical colleges. What is the exact hiring process that Yatharth follows? I think, you know, we have had this strategy that, you know, we do get doctors from the likes of Max, Fortis, Apollo, who have recently joined us. We have intentionally not targeted their head of departments. You know, we have targeted their number twos. That means the subheads, that means the associate directors, you know, who get a chance to become HODs and directors at our hospital. They are equally skilled, they're equally experienced, and they are actually much more hungry, and they are the ones who are actually driving the volumes in those hospitals. They join us because here they get the chance to become the head of the departments, which where, you know, in their older hospitals, that will take a much longer time. You know, that's why they're able to join us and be with us for a long time. You know, now I think, you know, we are, you know, getting a lot of leading doctors from all these hospitals, and that, that's where we get our doctors. Also our own doctors who have been with us for a long, long time, they have also grown into a big brand now. They've also become, you know, senior and leading doctors of the city. That's where our doctor pool is coming from. Okay, one more last question, like, is this call transcript will be available on the company's website? sorry, what is available on the company's website? This, analyst call transcript. I think Ambit, it can. Yes, it will be available on our website. Okay. Thank you. Thank you. Ladies and gentlemen, that was the last question for today. With that, we conclude today's conference call. On behalf of Ambit Capital, we thank you for joining us. You may now disconnect your lines. Thank you. Thank you very much from company side as well. Thank you very much. Thank you, members of the management.