MANAGEMENT DISCUSSION & ANALYSIS
INDIAN HEALTHCARE OVERVIEW
Indias healthcare sector is one of the largest and most dynamic industries in the country, both in terms of revenue and employment. It comprises a diverse mix of providers, ranging from public and private hospitals to diagnostics, pharmaceuticals, medical devices, insurance, and digital health services. With a strong policy push, technological advancements, and rising demand, Indias healthcare system is transitioning from a volume-based model to a valuebased, patient-centric ecosystem.
Indias healthcare landscape is undergoing rapid transformation, driven by innovation, policy reforms, digitalization, and increasing demand. The industry is expected to continue evolving into a more integrated, technology-driven, and patient-centric ecosystem. At the same time, there is a strategic focus on preventive care and chronic disease management, aiming to reduce the long-term burden on healthcare infrastructure.
With rising healthcare demands and evolving patient expectations, there is a growing emphasis on improving access and affordability especially in Tier 2 and Tier 3 cities, where infrastructure gaps have traditionally limited service availability.
India holds a distinct competitive advantage in the global healthcare landscape, primarily due to its large pool of well-trained, English-speaking medical professionals and a well-established ecosystem of hospitals, diagnostics, and pharmaceuticals. One of the most significant factors contributing to Indias global appeal is its cost competitiveness. The cost of medical procedures and surgeries in India is approximately one-tenth of that in the United States or Western Europe, making it an attractive destination for international patients seeking high-quality treatment at affordable prices.
This cost advantage, combined with strong clinical expertise and world-class facilities, has positioned India as a leading hub for medical tourism, drawing patients from Africa, the Middle East, Southeast Asia, and even developed countries. In addition, India has become a favourable location for clinical research and pharmaceutical R&D, driven by the relatively lower cost of conducting clinical trials and access to a large, diverse patient pool.
As these trends converge, Indias healthcare ecosystem is evolving into a more agile, data-driven, and patient-focused environment. The integration of digital technologies, growing investment in infrastructure, and supportive government policies are helping lay the foundation for sustainable growth and improved health outcomes, not just domestically but also as a key player in the global health arena.
The Government of India has set an ambitious vision to position the country as a global healthcare hub. To support this goal, it plans to increase public health expenditure to 2.5% of the countrys GDP by FY 2025, up from the current level of around 2.1%.
https://www.ibef.org/industry/healthcare-india
Trends in the Indian Healthcare Sector.
1. Integration of AI and Robotics
Artificial Intelligence (AI) is revolutionizing the Indian healthcare ecosystem by enhancing diagnostics, improving treatment precision, optimizing hospital operations, and enabling equitable access to quality care. In recent years, AI adoption has accelerated due to policy support, growing digital infrastructure, and increasing demand for efficient and affordable healthcare services.
AI-powered tools help in early and accurate disease detection, personalized treatment planning, and predictive analytics to improve patient outcomes. Robotics is increasingly being adopted in surgical procedures, enabling enhanced precision, minimally invasive techniques, and faster recovery times. Additionally, automation in hospital administration streamlines resource allocation, patient flow management, and operational efficiency.
2. Rise of Healthcare Startups
Indias healthcare startup ecosystem is flourishing, driven by innovations in AI diagnostics, wearable health devices, remote patient monitoring, and virtual care platforms. These startups are pivotal in bridging gaps in healthcare accessibility and affordability, especially in rural and semi-urban areas. The sector benefits from growing venture capital investments and government initiatives like the Startup India program, which support innovation and rapid scaling.
3. Sustainability and Green Healthcare Initiatives
Sustainability is gaining prominence in healthcare, with providers adopting environmentally responsible practices. These include green building designs, energy-efficient operations, and robust biomedical waste management systems. Hospitals are increasingly integrating sustainable procurement policies and circular economy principles in their supply chains, reducing environmental impact and promoting long-term sectoral resilience.
4. Digital Health and Telemedicine Expansion
Digital health adoption is accelerating across India, enabled by expanding internet access and widespread smartphone usage. The governments National Digital Health Mission (NDHM) is a cornerstone initiative aiming to build an interoperable digital health ecosystem with electronic health records (EHRs), unique health IDs, and secure data sharing protocols. Telemedicine platforms have become mainstream, offering remote consultations that ease the burden on overcrowded hospitals. Furthermore, AI-driven diagnostic tools and predictive analytics support early disease detection, personalized care, and optimized clinical workflows, enhancing both patient outcomes and healthcare efficiency.
5. Healthcare Infrastructure Expansion in Tier 2 and Tier 3 Cities
Significant investments are underway to expand healthcare infrastructure beyond metropolitan centers to Tier 2 and Tier 3 cities. This includes establishing multi-specialty hospitals, diagnostic centers, and primary healthcare facilities aimed at improving access and quality of care in underserved regions. Such expansion helps to reduce patient loads in urban hospitals and addresses the rural-urban disparity in healthcare availability, ultimately leading to better health outcomes nationwide.
SWOT Analysis
STRENGTH
1. Advanced Medical Technology and Infrastructure
At KMCH, we have Modern diagnostic tools, surgical equipment, and treatment technologies enhance accuracy and patient outcomes. Well-maintained facilities with state-of-the-art infrastructure ensure efficient workflows and improve patient comfort.
2. "Recognition from prestigious body such as NABH (National Accreditation Board for Hospitals) reinforces KMCHs compliance with stringent quality standards, strengthening its trust and credibility among patients, insurers, and regulatory agencies."
3. Wide Range of Medical Services and Specialties
KMCH Offers multidisciplinary services under one roof including emergency care, inpatient and outpatient services, diagnostics, and pharmacy provides convenience for patients and fosters cross-referrals within the hospital.
WEAKNESS
1. High Operational Costs
Maintaining advanced medical equipment, skilled personnel, and modern facilities involves significant ongoing expenses, which can strain budgets, especially amid intense market competition.
2. Workforce Shortages and High Staff Turnover
Attracting and retaining qualified healthcare professionals is challenging due to competition, high work pressure and quality of care.
3. Regulatory Challenges
Lack of uniform quality standards across healthcare providers; fragmented regulation of private hospitals and clinics.
OPPORTUNITIES
1. Large and Diverse Market
Second-largest population globally ensures a huge and growing demand for healthcare services. Rapid urbanization and increasing middle class lead to higher healthcare consumption.
2. Partnerships with Insurance Companies and Government Health Schemes
Collaborations with insurers and public health programs such as Ayushman Bharat can increase patient inflow by reducing out-of-pocket expenses and expanding coverage.
3. Adoption of Telemedicine and Digital Health Technologies
Leveraging teleconsultations, remote patient monitoring, and mobile health applications can enhance access to care, particularly in remote areas, while improving operational efficiency.
4. Growing Demand for Specialized and Preventive Healthcare Services
Rising incidence of chronic diseases fuels demand for specialized care (e.g., cardiology, oncology) and preventive health programs focused on early detection and lifestyle management.
THREAT
1. Technology Disruptions and Cybersecurity Risks
Increased reliance on digital systems makes hospitals vulnerable to data breaches, ransomware attacks, and IT failures, potentially compromising patient safety and data confidentiality.
2. Patient Data Privacy Concerns
With digitization comes the critical challenge of safeguarding sensitive health information from unauthorized access, alongside evolving regulatory compliance requirements.
3. Economic Fluctuations Impacting Patient Spending
Economic downturns may reduce patients willingness or ability to pay for elective procedures, thereby affecting hospital revenues and financial stability.
ABOUT KMCH
Kovai Medical Center and Hospital Limited (KMCH) was incorporated under The Companies Act, 1956 and started its commercial operation in June, 1990 with a capacity of 200 Bed Hospital in the outskirts of Coimbatore.
Nurtured with Indian hospitality and a western mind set, KMCH has grown into a 2,250 bed multi-locational, multidisciplinary Super specialty hospital, the best and most trusted in Southern India.
Over its more than three-decade journey, the hospital has serviced urban and rural patients from Western Tamil Nadu and parts of Kerala. The Main Center and the Medical College General Hospital is located very proximate to the city airport.
The cornerstones of KMCH legacy are its unstinting focus on clinical excellence, affordable costs, adoption of technology and academics
TECHNOLOGY, INNOVATION AND FACILITIES
KMCH, a leading multispecialty hospital and the pioneer and leader in introducing cutting-edge medical technologies for the benefit of patients, has now joined a select league of hospitals in India to offer indigenously developed CAR-T Cell Therapy for cancer patients.
The innovative therapy that requires significant clinical and technical expertise-available only in a few countries and select hospitals in India-is now available at KMCH Comprehensive Cancer Care Center. The hospital has successfully performed three therapies, the highest in Tamil Nadu.
Kovai Medical Center and Hospitals CAR-T cell program involves collecting and isolating T cells from affected patients blood, which are then genetically engineered to express CARs on their surface. These receptors are specifically designed to bind to antigens on the surface of cancer cells. Once infused into the patient, these modified T cells multiply, seek out and eradicate cancer cells. CAR-T cell therapy in KMCH is tailored and customized treatment for each individual patient.
KMCH, a leading multi-specialty hospital in South India having comprehensive epilepsy center. The comprehensive epilepsy center has advanced facilities including a 4-bed Video EEG unit, MRI, PET CT, SPECT, and FMRI. It is worth noting that over 60 successful epilepsy surgeries have been performed at this hospital since the COVID period. This center provides specialized treatment with individual attention to epilepsy in children and women.
Social Responsibility and Affordable Health Care:
1. Paediatric Ward: As a responsible corporate citizen, KMCHs passion for a healthy India has enabled it to extend its healthcare services far beyond pure business. KMCH opened a free Paediatric Oncology Ward in KMCH Medical College General Hospital, to cater to the needs of children with cancer, who cannot afford appropriate therapy.
2. Palliative Care Ward: KMCH has opened an affordable palliative care ward, fulfilling a vitally important but previously unmet need in the community.
3. Low Cost Care: KMCH Medical College General Hospital offers outpatient services across multiple specialties, providing affordable healthcare through high-volume, low-cost care.
OPERATIONAL EXCELLENCE
Healthcare
KMCH Performs a Rare Split Liver Transplant Surgery
KMCH Liver center, Coimbatore renowned for its high quality and successful work in management of liver failure and transplantation has gone beyond.
A 17-year-old boy met with road accident and who was declared brain dead. The family generously came forward to donate his organs. To maximise the utility of organs, the liver transplant team of doctors decided to split the liver into two halves and transplant to two different individuals waiting for liver transplant. Usually in such conditions one recipients would be a child. It is very rare to have two liver recipients in adult age group due to complexities involved in the procedure and size mismatch. After evaluating the donor suitability for such an exercise, the expert team split the liver and use it for 2 adults where one recipient is waiting for combined liver and kidney transplantation due to hyperoxaluria and kidney failure another patient with liver cancer and liver cirrhosis.
The procedure was carried out simultaneously and successfully completed by 2 expert teams. Both recipients liver function was good and fit for discharge after one week. Two months since the transplant both resumed their normal routine activities without any complications.
First Successful Epilepsy Brain Surgery on a Pregnant Woman in India
KMCH, a leading multi-specialty hospital in South India, has achieved a remarkable feat by successfully performing epilepsy brain surgery on a four-month pregnant woman suffering from severe epilepsy the first such documented case in India. Globally, this is only the second documented surgery of its kind performed on a pregnant woman.
The 31-year-old woman had been suffering from epilepsy since her youth. She also experienced seizures during her first pregnancy. While pregnant for the second time, the severity of her epilepsy increased alarmingly in the fourth month of gestation. She was experiencing 10 to 15 seizures daily, and the medications she was taking were ineffective. This situation posed a severe threat to the mothers life and the development of the fetus.
Subsequently, neurologists at KMCH conducted advanced MRI and Video EEG tests. These tests accurately identified a congenital malformation called Focal Cortical Dysplasia (FCD) in the right side of her brain as the cause of the continuous seizures. It is noteworthy that these tests are completely safe for both the mother and the fetus during pregnancy.
Generally, brain surgeries are avoided during pregnancy and are usually performed after delivery. However, in this patients case, the seizures were extremely severe, and medications were ineffective, leading to an immediate danger to the mothers life and the well-being of the fetus. Therefore, the high-level medical team at KMCH made the courageous decision to perform the surgery during pregnancy itself. A team comprising of epileptologist, epilepsy neurosurgeon, anesthetists, and obstetricians planned this challenging treatment with the full consent of the patient and her family.
Through a delicate surgery lasting several hours, the congenital malformation in the brain causing the seizures was successfully removed. Following the surgery, the patients seizures have completely stopped. Currently, two months post-surgery, the woman is six months pregnant and in good health. The unborn child is also developing healthily. The woman remains under the continuous monitoring of the medical team, and the need for anti-epileptic medication will be re-evaluated after delivery.
Medical education
KMCH Institute of Health Sciences and Research (KMCH IHSR), established in 2019 under the aegis of Kovai Medical Centre and Hospital Limited (KMCH), has rapidly emerged as a leading medical college in Tamil Nadu. KMCH is the first corporate hospital in India to start a medical college.
KMCH IHSR proposed to host its landmark 1st Graduation Day ceremony for the MBBS 2019-2025 batch on Saturday, May 31, 2025, at the Dr. N.G.P. Arts & Science College Auditorium. The event will be marked as a significant milestone for the institution and the graduating cohort of bright medical professionals.
Empowered with a dedicated team of healthcare professionals including doctors, nurses and paramedics, the infrastructure includes 750 general beds including 50 ICU beds, 30 emergency beds and 16 operation theatres with state-of-the-art medical equipment like CT scan, MRI, Cathlab, Ultra Sound and Digital X-Ray etc. The Medical College General Hospital offers 24x7 healthcare services to public.
AWARDS, ACHIEVEMENTS
KMCH Hospital continues to receive numerous accolades, reinforcing its commitment to exemplary patient care and its role as an industry leader. Among its many awards and achievements are:
"Brand Coimbatore Ambassador Award -2025by The India Chamber of Commerce and Industry, Coimbatore. "Coimbatore Best Employer Brand Award-2025by Employer Branding Awards.
Awarded "Excellence in Hospital Operations (Clinical) Award-2024by Association of Healthcare Providers India (AHPI).
Awarded "Employee Centric Hospital Award-2024by Association of Healthcare Providers India (AHPI).
"Best Performance in Kidney Transplantamong Private Hospitals in Tamil Nadu, 2023-2024.
"Best Performance in Liver Transplantamong Private Hospitals in Tamil Nadu, 2023-2024.
DISCUSSION ON FINANCIAL AND OPERATIONAL PERFORMANCE
Below detailed table presents summaries of Financial Results of Operations for the Year ended 31st March, 2025 and 2024. The Company operates on two segments Healthcare Services and Education Services.
(Rs. in Lakhs
Particulars |
92024-25 | 2023-24 |
Operating Income |
1,37,111.30 | 1,21,955.27 |
Other Income |
2,210.42 | 2,094.92 |
Total Income |
1,39,321.72 | 1,24,050.19 |
Medicines & Hospital Consumables |
36,842.11 | 32,389.87 |
Consultant charges to Doctors |
19,136.55 | 17,574.88 |
Employee Benefit Expense |
25,118.15 | 21,946.54 |
Finance Costs |
3,267.67 | 3,294.39 |
Particulars |
B 2024-25 | 2023-24 |
Depreciation & Amortisation Expense |
9,758.66 | 9,213.62 |
Other Expenses |
17,443.22 | 15,875.22 |
Total Expenses |
1,11,566.36 | 1,00,294.52 |
Profit Before Taxation (PBT) |
27,755.36 | 23,755.67 |
Provision for Taxation |
6,860.74 | 5,782.60 |
Profit After Taxation |
20,894.62 | 17,973.07 |
Add: Other Comprehensive Income |
(38.01) | 70.57 |
Total Comprehensive Income for the year |
20,856.61 | 18,043.64 |
REVENUE
Total Operating Revenue grew 12.43% from Rs. 1,21,955.27 Lakhs in FY 24 to Rs. 1,37,111.30 Lakhs in FY 25
Healthcare Services: Inpatient Revenues grew by 14.77% from Rs. 80,161.53 Lakhs in FY24 to Rs. 92,002.25 Lakhs in FY25 and Outpatient Revenue grew by 10.58% from Rs. 32,299.63 Lakhs in FY 24 to Rs. 35,716.53 Lakhs in FY 25. Increase in Revenues primarily attributable to increase in Surgeries, Inpatient and Outpatient Volumes.
Education Services: This is the sixth year of reporting on Education Services consequent to the commencement of KMCH Institute of Health Sciences & Research (KMCH Medical College). Revenues under this segment decreased from Rs. 9,365.91 Lakhs in FY 24 to Rs. 9,254.95 Lakhs in FY 25, which also includes income from Allied Health Sciences and Diplomate of National Board courses
Below Table shows the key drivers of revenue for the periods presented year ended 31st March, 2025.
Particulars |
2024-25 | 2023-24 | Increase/ (Decrease) | % Increase/ (Decrease) |
Inpatients (Nos.) |
1,05,269 | 97,978 | 7,334 | 7.44% |
Inpatients Revenue (Rs. in Lakhs) |
92,002.25 | 80,161.53 | 11,840.72 | 14.77% |
Outpatients (Nos.) |
12,40,046 | 11,97,876 | 42,173 | 3.52% |
Outpatients Revenue (Rs. in Lakhs) |
35,716.53 | 32,299.63 | 3,416.90 | 10.58% |
KMCH IHSR (No. of Students) |
897 | 747 | 150 | 20.08% |
AHS Courses (No. of Students) |
770 | 738 | 32 | 4.34% |
Income from Educational Institutions (Rs. in Lakhs) |
9,254.95 | 9,365.91 | (110.96) | -1.18% |
Other Operating Income (Rs. in Lakhs) |
137.57 | 128.20 | 9.37 | 7.31% |
Total |
1,37,111.30 | 1,21,955.27 | 15,156.03 | 12.43 |
KMCH IHSR KMCH Institute of Health Sciences and Research
AHS Allied Health Sciences Courses
Particulars |
2024-25 | ZZ ~2023-24 |
Bed Capacity at the end of the Period (In Nos.) |
2,032 | 1,975 |
Operating Beds at the end of the Period (In Nos.) |
1,847 | 1,787 |
Inpatient (In Nos.) |
1,05,269 | 97,978 |
Outpatient New & Review (In Nos.) |
12,40,046 | 11,97,876 |
Bed Occupancy Rate |
60.44% | 60.76% |
Average Length of Stay (In Days) |
3.87 | 4.06 |
Average Revenue per occupied bed (in Rs.) |
22,581 | 20,173 |
EXPENSES
MEDICINES AND HOSPITAL CONSUMABLES
During the year ended FY 25, Cost of Medicines and Hospital Consumables increased from Rs. 32,389.87 Lakhs in FY 24 to Rs. 36,842.11 Lakhs. Increase of 13.75% is in line with the growth in operating revenues.
CONSULTANT CHARGES
During the year ended FY 25, Consultant charges increased from Rs. 17,574.88 Lakhs in FY 24 to Rs. 19,136.55 Lakhs. Increase of 8.89% is in line with the growth in operating revenues.
EMPLOYEE BENEFITS EXPENSE
Employee Benefit Expenses increased from Rs. 21,946.54 Lakhs in FY 24 to Rs. 25,118.15 lakhs. Increase is in line with salary increase and increase in head count.
FINANCE COSTS
Finance Costs reduced from Rs. 3,294.39 Lakhs in FY 24 to Rs. 3,267.67 lakhs, a reduction of Rs. 26.72 Lakhs. This decrease in Finance Costs is due to regular principal payment in FY 25.
DEPRECIATION AND AMORTIZATION EXPENSE
Depreciation and Amortization Expenses has increased from Rs. 9,213.62 Lakhs in FY 24 to Rs. 9,758.66 Lakhs, an increase of Rs. 545.04 Lakhs. Increase is mainly due to addition of capital assets amounting to Rs.261.92 crore during the year.
OTHER EXPENSES
Table below summarizes the operating and other Administrative Expenses for the year ended 31st March, 2025
Year ended 31.03.2025 |
Year ended 31.03.2024 |
|||||
Particulars |
Rs. in Lakhs | % of Revenue | Rs. in Lakhs | % of Revenue | Increase/ (Decrease) | % Increase/ (Decrease) |
Stores, Dietary, Power & Fuel |
4913.78 | 3.58 | 4,885.99 | 4.01 | 27.79 | 0.57% |
Hospital Upkeep Expenses |
3,330.23 | 2.43 | 2,768.64 | 2.27 | 561.59 | 20.28% |
Marketing & Advertising |
943.20 | 0.69 | 825.96 | 0.68 | 117.24 | 14.19% |
Repairs & Maintenance |
2,690.00 | 1.96 | 2,574.19 | 2.11 | 115.81 | 4.50% |
Rent |
40.08 | 0.02 | 5.41 | 0.00 | 34.67 | 640.85% |
Other Administrative Expenses |
5,525.93 | 4.03 | 4,815.03 | 3.94 | 710.90 | 14.76% |
Total |
17,443.22 | 12.71 | 15,875.22 | 13.02 | 1,568.00 | 9.88% |
KEY FINANCIAL RATIOS
Key Financial Ratios are detailed in Note No.55 of Notes to Financial Statements.
LIQUIDITY
Primary Sources of Funds are Cash Flows generated from Operations as well as Long Term Borrowings, if required. It is expected that internally generated Cash Flows and our proposed drawdown from sanctioned debt will be adequate to service existing debt, fund internal growth and deploy funds for all Capital Expenditure.
RISK MANAGEMENT
In a rapidly changing business environment with dynamic customer requirements, business risks are constantly evolving. As a result, there is significant variation in the emerging risks landscape across businesses. On account of multi-fold increase in scale and the expanded area of operations, your company gets exposed to a wide range of both internal and external risks and uncertainties.
These internal and external factors may affect achievement of the companys objectives whether they are strategic, operational or financial. Risk managements objective is to assure that uncertainty does not deflect the Companys progress from its envisioned business goals.
The Company Risk Management approach is towards striking a balance between managing risks and capitalising opportunities. Its response to identified risks includes acceptance, avoidance, transfer and mitigation. Greater focus is given towards ring-fencing the organisation from major risks that are likely to have a lasting impact on the Company profitability and sustainability.
CAUTIONARY STATEMENT
Statements in this Management Discussion and Analysis describing the health care sectors objectives, projections, estimates, expectations and predictions contain "forward looking statementswithin the meaning of applicable laws and regulations. These statements and forecasts involve risk and uncertainty because they relate to events and depend upon circumstances that may or may not occur in the future. Actual results might differ materially from those either expressed or implied.
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