Chennai-based Apollo Hospitals Enterprises Ltd registered a 14.7 per cent decline in standalone net profit at ₹285 crore for the financial year ended March 31, 2017 against ₹334 crore last year.
The hospital chain’s standalone revenue grew 15 per cent to ₹6,442 crore (₹5,588 crore) . Profit from healthcare services stood at ₹436 crore, a 10.6 per cent decline, compared to ₹488 crore.
In the quarter ended March 31, 2017, the company registered standalone net profit of ₹48 crore, a 41 per cent decline, compared to ₹81 crore profit for the same quarter the previous year.
According to an official statement from Apollo Hospitals, one of the reasons for fall in profit was the ban on high value currencies of ₹500 and ₹1000 by the Centre in November last. Due to demonetisation, the hospital saw drop in outstation patients and patients from neighbouring countries, who found it difficult to access currency for their treatment requirements. In addition to demonetisation, the hospital chain witnessed steep drop in profits during the third quarter of FY2017 due ‘VIP occupancy’ and Cyclone Vardah in Chennai cluster. Late Tamil Nadu Chief Minister J Jayalalithaa was admitted to Apollo Hospitals, Chennai, from September 22, 2016 to December 5, 2016, when she passed away. Due to these patient flows into Chennai took some time to recover, fully affecting profits.
The impact of the above incidents resulted in a revenue drop of ₹15-20 crore. In addition, the Government regulation on stent pricing resulted in a revenue compression of ₹8-10 crore for the company.
In the hospital segment, while Chennai cluster was reeling under the impact of multiple one-off events, Hyderabad and Bengaluru cluster revenues increased due to rising local client base. While new hospitals continued to grow in terms of volume, they posted an operating loss of ₹430 lakh for the financial year 2017 as opposed to ₹100 lakh for the same period the previous year. This is largely due to start-up losses of ₹30 crore in Navi Mumbai, Nellore and Malleswaram.