In a recent interview, Ashutosh Raghuvanshi, MD & CEO, Narayana Health gave a brief description in regard of contribution made to children’s hospital in Mumbai. He confirmed that fiscal year 2017 has been working well for the company as operating revenues have shown the increasing trend towards 20 per cent. According to him, since Average Revenue per Occupied Bed (ARPOB) has started to rise in alignment with complexity of cases and occupancy, the final result is growth oriented.
While Narayana Health is endeavoring to set up 973 beds in three varied locations over the period of two to three years, the Mumbai hospital is going to receive 297 beds outlet within this financial year. On being asked about contribution of Mumbai Pediatric Hospital in future, Raghuvanshi confirmed it to be a Greenfield hospital that is expected to be taken to normal trajectory. He further said, “The occupancies in the initial stages of most hospitals remain in the range of 15-20 percent. However we expect ARPOBs to be reasonably good here because of the location and we expect the ARPOBs to be in line with what our group ARPOBs are and occupancy to be in the range of 20 percent with this fiscal year. So, we should have at least one full quarter coming from this hospital.”
To detail out the reasons for improvement of cash flow situation he explained that facilities are going into their maturity cycle is a substantial reason. Also, conversion of Rs. 100 crore pre initial public offering (IPO) of the CDC which was a convertible debt instrument and was done pre- IPO is another reason for overall augmentation. With finance cost going down, it is likely to remain in that zone.