“Chennai’s Apollo Hospitals Plans to Raise $200 Million by Selling Stake in Apollo HealthCo”

During the quarter, Apollo 24/7’s Gross Market Value (GMV) exceeded expectations, reaching ₹1,630 crore compared to the anticipated ₹1,500 crore.

Chennai’s Apollo Hospitals plans to raise approximately $200 million in the current fiscal year by selling a stake in its healthcare platform, Apollo HealthCo, according to sources. The hospital chain aims to sell a 5-6 percent stake in Apollo HealthCo, valuing it at an estimated enterprise value of $2.5-$3 billion, as stated by a top executive.

During the financial year 2023, Apollo Hospitals reported revenues of ₹6,705 crore but incurred a loss of ₹304 crore. However, their offline pharmacy distribution business showed positive performance, generating ₹534 crores in earnings before interest, tax, depreciation, and amortization (EBITDA), with a YoY growth of 31 percent. On the other hand, the digital health business has been experiencing a quarterly cash burn of around ₹180 crores on average.

Looking forward, Apollo Hospitals anticipates operational improvement in the financial year 2024. They expect Apollo 24/7, their omnichannel business, to achieve EBITDA breakeven by the fourth quarter of that year. Managing Director Suneeta Reddy expressed optimism, mentioning that despite incurring losses over the past 18 months, they are confident in reaching EBITDA breakeven within the specified timeframe. During the quarter, Apollo 24/7’s Gross Market Value (GMV) exceeded expectations, reaching ₹1,630 crore compared to the anticipated ₹1,500 crore.