Abate As Industries Ltd Management Discussions

1. Industry Structure and Developments

The Indian healthcare sector continues to evolve rapidly, emerging as one of the most critical pillars of the nations socio-economic development. Encompassing hospitals, diagnostics, medical devices, health insurance, and digital health platforms, the industry has gained renewed momentum post-COVID, driven by increased public health awareness, greater government spending, and digital transformation.

Particularly in eye care a sector where Abate AS has a pioneering presence there is a sharp increase in demand due to aging demographics, chronic conditions like diabetes, and the growth of refractive surgeries. Public-private partnerships and technological innovations, such as AI-enabled diagnostics and teleophthalmology, are further redefining patient care models.

2. Opportunities and Threats

Expansion into underserved and international markets (e.g., Bahrain, Manjeri)

Rising healthcare expenditure by both public and private sectors

Rapid acceptance of telemedicine and digital consultation

Increasing demand for super-specialty eye care services

Vision to create a private university for healthcare and innovation-driven education

Competitive pressure from new entrants and large hospital chains

Technological obsolescence in treatment equipment

Attrition of skilled professionals and dependency on key medical staff

Regulatory compliance complexity and policy fluctuations

Thin operational margins in high-volume healthcare models

3. Segment-wise or Product-wise Performance

Abate AS Group of Companies primarily operates in the eye healthcare segment through its super-specialty hospitals and optical outlets. During FY 2024-25, the Abate AS Group has witnessed robust growth in patient footfalls across its centers in Perinthalmanna, Chennai, and Calicut. We diversified operations in Bahrain (through retail and healthcare) also delivered strong performance, contributing to both revenue and brand visibility.

4. Outlook

The outlook for Abate AS Group of Companies remains exceptionally positive. With strategic plans to launch 44 international eye hospitals and the development of a multidisciplinary private university, the company is well-positioned to shape the future of healthcare and education.

Our expanding footprint across South India and the Gulf, coupled with investments in cutting-edge medical technologies, AI-driven diagnostics, and patient-centered service delivery models, will drive sustainable growth. The companys focus on value-based care and ethical practices further enhances its competitive edge.

5. Risks and Concerns

While the growth trajectory is strong, the company must vigilantly manage:

Talent retention, especially experienced clinicians and surgeons

Supply chain risks for high-quality medical materials

Regulatory and cross-border compliance for international operations

Rising cyber-security threats in digital healthcare platforms

Delays in project execution due to external factors

6. Internal Control Systems and Their Adequacy

The company has implemented robust internal control systems to safeguard assets, ensure regulatory compliance, and enhance operational efficiency. An independent Internal Auditor regularly assesses the effectiveness of these controls and reports to the Audit Committee. Policies and procedures are reviewed and updated to reflect evolving risks and regulatory requirements.

7. Financial Performance with respect to Operational Performance

The increase in the revenues in FY 2024-25 reflects enhanced utilization across our hospital network and expanding patient volumes. Retail and consultancy segments also witnessed incremental growth. Operational efficiencies and strategic cost control helped maintain margins in an inflationary environment.

8. Material Developments in Human Resources

The company continues to invest in training and development programs for its staff to enhance service delivery and employee engagement. While there were no significant structural HR changes during the year, initiatives in digital onboarding, employee wellness, and leadership development were introduced to support future growth.

9. Environment, Health and Safety (EHS)

As a healthcare provider operating across multiple jurisdictions, Abate AS adheres to stringent EHS norms. Compliance with local environmental and health regulations remains a top priority. Continuous audits, risk assessments, and employee training are conducted to ensure a safe and healthy workplace for both patients and staff.

Healthcare Expansion: Roll-out of new eye hospitals in Manjeri and Bahrain.

Technology & Innovation: Increased adoption of digital platforms, AI-based diagnostics, and robotic surgeries.

Education: Launch of a private university focused on healthcare, architecture, and business.

Retail Growth: Consolidation and scaling of Bahrains retail footprint through strategic acquisitions.

Value Creation: Vision to raise BSE share price to 500 through sustainable growth and strong investor confidence.

There was a significant improvement in RoNW owing to equity expansion through preferential allotments, reflecting the companys strengthened capital structure.

1. Current Ratio

Increase in Current ratio is due to increase in current assets in FY 2024-25

2. Debt - Equity Ratio a. The Company resorted to debt financing in order to meet statutory payments and other working capital requirments b. Share capital increased due to issue of new shares and other equity increased due to net profit and Increase in Share premium balances during FY 2024-25

3. Return on Equity Ratio

Return on capital increased due to increase in net profit for FY 2024-25 and increase in share capital in FY 2024-25.

4. Return on capital employed

Return on capital employed is increased due to increase in net profit for the year 2024-25.

Abate AS Industries Limited is on a transformative journey, combining its legacy in eye care with new ventures in education, retail, and global healthcare delivery. With a clear vision, ethical foundation, and strategic foresight, the company is well-placed to achieve its growth ambitions and deliver enduring value to all stakeholders.

This MDAR contains forward-looking statements that involve risks and uncertainties. Actual results may differ materially due to market conditions, changes in policies, and unforeseen developments.