Apollo Hospitals postpones plans to list in Singapore

Chennai March 10,2014 : Healthcare major Apollo Hospitals has postponed its plans to list a business trust on the Singapore Stock Exchange, in anticipation of improving its rating with the completion of some of its ongoing projects.

Speaking to reporters on the sidelines of Women Managers’ Convention 2014, organised by theMadras Management Association (MMA), Preetha Reddy, managing director – Apollo Hospitals Enterprise Limited (AHEL), said, “We have postponed our plans for listing on the Singapore Stock Exchange. We were actually expecting to do it by end of this year.”

She said there are so many projects under implementation in the company and an improved rating would be beneficial for the company, while listing at a later stage. However, the hospital chain has not finalised when it would be listing on the Singapore Exchange.

The company earlier said it was looking at an option to list in Singapore.

The listing would help the company to leverage more potential in expanding its presence and strengthening its operations, said a senior company official earlier.

The company is in the expansion phase, which requires large investments.

At present, it has plans to set up around 2,310 beds across the country by FY16 and was planning to invest over Rs 2,100 crore for the expansion. Out of this, it has already invested Rs 616 crore till December 31, 2013, according to a company document.

Besides, it is also looking at establishing its presence in specialty healthcare service business, especially cancer care centres.

AHEL has eight cancer care hospitals and plans are to double it in the 3 years, while the actual goal is to achieve 20 cancer care hospitals, he said. Plans for around four new cancer care hospitals are in the planning, according to company sources.

Earlier, senior company officials said while there were plans to raise funds through real estate assets, it is awaiting the Real Estate Investment Trust (REIT) regulations.

While Reddy said that the company will wait for the REIT regulations to be in place in the country, she did not reveal more on the plans. Even as India is yet to see REIT regulation, framework for REIT exists in several countries including United States of America, Australia, Singapore, Japan, France, United Kingdom.

REIT is an investment vehicle, which allows to invest primarily in completed, revenue generating real estate assets and distribute major part of the earning among their investors. Most of such investments are in completed properties which provide regular income to the investors from the rentals received from such properties, according to the draft regulation issued by Sebi in October, 2013.

This has been identified by various industries including hospitals to bring their real estate assets under a business trust, through which investors could directly invest. By listing the trust, the companies would be able to attract investment from various types of investors including private equity investors, apart from the initial fund raising through Initial Public Offering (IPO).

It may be noted that Fortis Healthcare India Ltd, another healthcare service provider chain promoted by Malvinder Mohan Singh and Shivinder Mohan Singh, has earlier formed a business trust, Religare Health Trust, bringing its real estate in it and listed a business trust with Singapore Exchange. Business Standard