Healthcare industry to reach $100 bn by 2017
Dr. Om Manchanda, CEO, Dr. Lal PathLabs
Dr Om P. Manchanda (Manchanda), who is the CEO of Dr Lal PathLabs (LPL), holds a bachelor’s degree in veterinary science and animal husbandry from the Haryana Agricultural University, Hisar and a post-graduate diploma in management (agriculture) from the Indian Institute of Management, Ahmedabad (“IIMA”).
Over the last ten years, Manchanda has successfully transformed and built Dr. Lal PathLabs as one of the leading Diagnostic Company in India. He has taken Dr. Lal PathLabs to a successful listing on NSE in Dec’ 2015. Manchanda won the Achiever of the Year Award in 2014, presented by CEO India as a part of CEO Awards 2014. He is currently responsible for development and execution of short and long term strategies and is also in-charge of the day to day management aspects. In conversation with Dominic Rebello, Manchanda reveals the factors that are leading to the growth of the healthcare and diagnostic sector.
Give us the broad view about the Healthcare and Diagnostic sector?
The India healthcare industry is one of the largest and fastest-growing industries in the country, growing at a 12% CAGR to reach US$ 100 billion by 2017. Rising spending power, increasing life expectancy, growing health awareness and changing attitude towards preventive healthcare are some of the factors contributing towards this growth. Considering the robust demand for healthcare services in India, the sector currently presents immense scope for enhancing healthcare services in India.
Diagnostic centers in India can be classified into three types Hospital-based centers, Diagnostic chains and Standalone centers. Riding on the increasing demand in the healthcare sector, the potential for growth in the diagnostic sector is enormous. With health issues rising by the day in India, the pressure on diagnostic healthcare has increased, forcing a number of such platforms to increase their presence around the country. According to CRISIL Research, the size of the Indian diagnostic healthcare services industry was approximately Rs. 377 billion (US$6.0 billion) in Fiscal Year 2015, and it is projected to grow to over Rs. 600 billion (US$9.6 billion) by Fiscal Year 2018.
How big is the potential for Dr Lal PathLabs business operations?
Given the low penetration of healthcare facilities and increasing demand, the potential for growth in the diagnostic sector is enormous. We believe that the increasing prescription of diagnostic tests and services by healthcare providers in India, combined with the growing focus on early detection and prevention of chronic and lifestyle diseases, such as diabetes, hypertension, heart disease and cancer, creates a significant market opportunity for us.
What are the growth drivers for Dr Lal PathLabs post listing on exchanges?
We have continued to expand our presence in the markets in which we operate, besides expanding into other markets in India through strategic acquisitions and partnerships. We have increased the breadth of our diagnostic healthcare testing and services platform and have continued our focus on providing our customers with quality diagnostic and related healthcare tests and services by leveraging our network efficiencies to expand our management of hospital-based and other clinical laboratories.
Is the company present pan India?
Dr Lal PathLabs has an integrated, nationwide network, offering patients and healthcare providers a broad range of diagnostic and related healthcare tests and services for use in core testing, patient diagnosis and the prevention, monitoring and treatment of disease and other health conditions. Our network is present across India, including large cities such as New Delhi, Mumbai, Bengaluru, Chennai, Hyderabad and Kolkata.
The company is further looking at expanding its presence pan-India to be a key driver for the next phase of growth for the company. While deepening its presence in the North Indian market where it already has a strong presence, the company is looking to scale up in other parts of the country as well. Banking on our near leadership in northern India, we are assertively moving into other potentially good geographies, the first of which will be East and Central India where we believe the operation is at an inflection point. For the rest of the country and particularly in the South and West, the company is taking a cluster approach by growing around cities and towns where it sees potential and in the long term building towards a regional reference laboratory model.