SHALBYNSE29 July 2019

Shalby Limited has informed the Exchange regarding Investor Presentation on financial and operational performance for quarter ended June 30, 2019

Shalby Limited

SHALBYMULTI-SPECIALTY——HOSPITALS——July29,2019 Shalby/SE/2019-20/36TheListingDepartmentCorporateServiceDepartmentNationalStockExchangeofIndiaLtdBSELimitedMumbai400051.Mumbai400001.ScripCode:SHALBYScripCode:540797Sub:InvestorPresentationforthefirstquarterended30thJune2019-disclosureunderRegulation30ofSEBI(ListingObligationsandDisclosureRequirements),Regulations,2015(“theSEBILODR”)DearSir/Madam,WearesubmittingherewithInvestorPresentationonfinancial&operationalperformanceoftheCompanyforthefirstQuarterended30'"June2019,whichisalsobeingmadeavailableonourwebsite.Werequesttotakethesameonyourrecordsanddisseminatethesametothemembers.Thankingyou, Yourssincerely,eSYForShalbyLimitedcARIADAS:DRD=SrJayeshPatelCompanySecretary&ComplianceOfficerMem.No:ACS14898 JfNYle/\}Encl.:asabove ShalbyLimitedRegd.Off.:Opp.KarnavatiClub,SGRoad,Anmedabad—380015(India)Tel.No.:(079)40203000|Fax:(079)40203109|www.shalby.org|info@shalby.orgRegd.No.:061000596=|CIN:L85110GJ2004PLC044667Vapi-Indore-Jabalpur-Mohali-Naroda(Ahmedabad)KrishnaShalby(Ahmedabad)Surat-JaipurUpcomingHospitals:Nashik-MumbaiINVESTOR PRESENTATION – Q1 FY20

SHALBY LIMITED (BSE CODE: 540797 I SHALBY, NSE CODE: SHALBY)

A leader in Joint Replacement surgeries in India with an established chain of multi-specialty tertiary care hospitals.

www.shalby.org

DISCLAIMER

No representation or warranty, express or implied is made as to, and no reliance should be placed on, the

fairness, accuracy, completeness or correctness of such information or opinions contained herein. The

information contained in this presentation is only current as of its date. Certain statements made in this

presentation may not be based on historical

information or

facts and may be “forward looking

statements”, including those relating to the Company‟s general business plans and strategy, its future

financial condition and growth prospects, and future developments in its industry and its competitive and

regulatory environment. Actual results may differ materially from these forward-looking statements due to a

number of factors, including future changes or developments in the Company‟s business, its competitive

environment and political, economic,

legal and social conditions in India. This communication is for

general

information purpose only, without regard to specific objectives, financial situations and needs of

any particular person. This presentation does not constitute an offer or invitation to purchase or subscribe

for any shares in the Company and neither any part of it shall form the basis of or be relied upon in

connection with any contract or commitment whatsoever. The Company may alter, modify or otherwise

change in any manner the content of this presentation, without obligation to notify any person of such

revision or changes. This presentation can not be copied and/or disseminated in any manner.

www.shalby.org

RECENT RECOGNITION

 Shalby Hospitals recognized with Best brand evolution Award, category of the Healthcare

Excellence Awards 2019 by Indian Express (Express Healthcare) on 11th July, 2019.

www.shalby.org

CONTENT

CORPORATE FACTS

OPERATIONAL PERFORMANCE

FINANCIAL PERFORMANCE

OTHER KEY UPDATES

www.shalby.org

CORPORATE FACTS

www.shalby.org

“

We value all human life placed in our hands and constantly working towards meeting the expectations of our customers and stakeholders by raising the standards of our service deliverables.

www.shalby.org

”

CORPORATE PHILOSOPHY

VISION

MISSION

Exceeding expectation from health

Leveraging global leadership in Joint replacement to establish multi-specialty care across geographies

ELITE :OUR CORE VALUES

EXCELLENCE

We work with an intent to achieve excellence in whatever we do

INTEGRITY

We always do the right thing, even when no one is watching

LEARNING

We continuously learn, evolve & constantly look for newer and more efficient ways to achieve our goals.

TEAMWORK

We work together for one objective : Patient satisfaction

EMPATHY

We do everything possible for our patient's well- being, safety, com fort & happiness

www.shalby.org

EMINENT LEADERSHIP

KEY ACHIEVEMENTS:

 Over two and a half decades of professional work experience across UK, USA and India. Serving as Director, Department of Knee Replacement at Shalby Hospitals since 1993

 Dr. Shah innovated zero „0‟ Technique in 2011 and was awarded the

Double Helical Award 2017, for the innovation

o Reduction of surgery time: 2.5 hours to 22 minutes o Reduction in patient stay: 15 days to 3 days o Drastic fall in infection rates due to minimum incision

 Invented the OS Needle, which is thick bore reverse cutting needle used in attaching soft tissues to the bone. Before the invention of the Needle, surgeons had to use complicated soft tissue procedures that had a very high failure rate. The needle can be attached with commonly available vicryl thread

 President of Indian Society of Hip & Knee Surgeons (ISHKS) for the

year 2010-11

 Part of joint international faculty for development of new joints by

Zimmer Inc., USA

 Receiver of several awards and accolades by reputed organizations

Dr. Vikram Shah Chairman & Managing Director

 MS Orthopaedics  AO Basic Course (London)  F.A.O.A.A (Switzerland)  F.A.I.S.F (Germany)

www.shalby.org

HISTORIC EVOLUTION

Year

1994

2004

2007

2011

2015

2017

2019

Bed Capacity

# of Hospitals

228

594

1070

2012

 Started

 Revenue

professional practice with a 6-bed facility (Vijay Shalby)

growth – 100 times in first 10 years Incorporation of Company

 Operationalize d First Multi specialty Hospital of the group Shalby SG

 Acquired

Shalby Vapi

 Commissioned Shalby Jabalpur

 Acquired

Krishna Shalby

 Commissioned Shalby Indore

Key Milestones

 Bed capacity

 Started

implementation of advanced Hospital Information System (HIS) & SAP ERP

grown 10 times in 10 years – to 2012 beds. Commissioned: Shalby Jaipur Shalby Naroda Shalby Surat Shalby Mohali

 Went public

through IPO on BSE & NSE.

www.shalby.org

CORPORATE FACTS

Hospitals

2012

1200

Total Bed Capacity

Operational beds

60%

46%

31%

Operating bed to total bed capacity

Bed Occupancy (based on 985 census beds)

12 year CAGR Revenue

3000+

Human Resource (Doctor + Staff)

36% 12 year CAGR EBITDA

2000+

Surgeries per month

33000+

Patients served per month

 Double-digit return ratios against industry trend of single-digit

 Consistently superior ROCE of mature hospitals

www.shalby.org

ORGANISATION STRUCTURE

 CORPORATE STRUCTURE

Chairman & Managing Director

Director

Group COO

CFO

CHRO

CIO

VP Projects

Cluster COO

CORPORATE SUB-FUNCTIONS

Unit CAO

UNIT TEAMS

 UNIT LEVEL STRUCTURE

Unit CAO

Clinical Applications

Corporate development

Accounts

Hospitality

IT/Systems

Billing

Pharmacy

Admin/Operations/Eng.

Quality

SCM

Nursing

INTERNAL AUDITOR

STATUTORY AUDITOR

Radiology & Pathology

 PWC

 T R Chdha & Co LLP

www.shalby.org

SHAREHOLDING PATTERN AS ON 30th JUN 2019

PROMOTER & PROMOTER GROUP

79.43%

RESIDENT INDIVIDUALS

7.21%

FOREIGN PORTFOLIO - CORP

5.47%

BODIES CORPORATES

4.65%

EMPLOYEE TRUSTS

0.93%

ALTERNATIVE INVESTMENT FUND

0.91%

NON RESIDENT INDIANS

0.30%

BANKS

0.14%

CLEARING MEMBERS

0.16%

OTHERS

0.80%

www.shalby.org

OUR PRESENCE

Existing 11 Units (2012 beds)

Upcoming 3 Units (388 beds)

Network of 37 Outpatient Clinics across 11 states in India

 National Presence

 International Presence (in Africa)

PUNJAB  Mohali – 145 beds

RAJASTHAN  Jaipur – 237 beds

GUJARAT  Ahmedabad

o SG – 201 beds o Krishna – 220 beds o Vijay – 27 beds o Naroda – 267 beds

 Vapi – 146 beds  Surat – 243 beds

MADHYA PRADESH  Indore – 243 beds  Jabalpur – 233 beds

MAHARASHTRA  Ghatkoper (Zynova) – 50 beds

www.shalby.org

Sudan (1)

Addis Ababa (1)

Eldoret

Kisumu Rwanda (1)

Nairobi (1)

Nairobi (1) Dar es Salaam (2)

Kenya

Tanzania

Ethiopia

Sudan

Rwanda

Upcoming Units

MAHARASHTRA  Mum (Ghatkoper) – 100 beds – Capex : Nil  Mum (Santacruz) – 175 beds – Capex: INR 150Cr  Nashik – 113 beds – Capex: INR 25Cr

OPERATIONAL PERFORMANCE

www.shalby.org

PERFORMANCE SYNOPSIS – Q1 FY 20

Particulars

Q1 FY19

Q4 FY19

Q1 FY20

Growth Y-O-Y(%) Growth Q-O-Q(%)

Total Revenue (INR million)

Total EBITDA (INR million)

EBITDA Margin (%)

Bed Capacity (Nos.)

Operational Beds (Nos.)

Average Length of Stay

Occupancy (Beds)

Occupancy (%) (based on operational beds)

In-Patient Count (Nos.)

Day-Care Patient Count (Nos.)

Out patient Count (Nos.)

Surgeries Count

ARPOB ( In Rs.)

1,187.40

275

23.20%

2012

1102

4.19

419

38%

9107

3159

70525

5480

31,141

1153.9

169.8

14.70%

2012

1102

4.38

417

38%

8672

6644

77140

4893

30,760

1337.2

311.5

23.30%

2012

1200

4.24

457

38%

9799

6356

87575

6146

32,154

www.shalby.org

13%

16%

83%

10 bps+

860bps+

101%

24%

12%

10%

13%

-4%

14%

26%

IP, OP, SURGERIES – QUARTERLY TREND

IP Count

OP Count

Surgeries Count

14761

5027

13642

4844

12266

3159

15316

16155

6356

6644

9107

9734

8798

8672

9799

70525

76794

71738

77140

87575

5480

3155

4897

4638

4893

2689

2619

2685

2325

2208

2019

2208

6146

2921

3225

Q1 FY19 Q2 FY19 Q3 FY19 Q4 FY19 Q1 FY20

Daycare

Arthroplasty

Other

 IP GROWTH Q1FY19 Vs Q1FY20 : 8%

 OP GROWTH Q1FY19 Vs Q1FY20 : 24%

 SURGERY GROWTH Q1FY19 Vs Q1FY20 :12%

 IP GROWTH Q4FY19 Vs Q1FY20 :13%

 OP GROWTH Q4FY19 Vs Q1FY20 :14%

 SURGERY GROWTH Q4FY19 Vs Q1FY20 :26%

 DAYCARE GROWTH Q1FY19 Vs Q1FY20 :101%

 DAYCARE GROWTH Q4FY19 Vs Q1FY20 :-4%

www.shalby.org

IP, OP, SURGERIES – MATURITY WISE QUARTERLY TREND

Q1 FY19

3690

2917

2359

IP Count

Q1 FY20

3382

3237

2741

Q1 FY19

Q1 FY20

Day Care Count

4811

141

6+ Years

4-6 Years

2-4 Years

<2 Years

1802

439

800

530

954

506

6+ Years

4-6 Years

2-4 Years

<2 Years

6+ Years

4-6 Years

2-4 Years

<2 Years

6+ Years

4-6 Years

2-4 Years

<2 Years

Q1 FY19

29157

OP Count

Q1 FY20

32627

21825

16540

3003

26060

22459

Q1 FY19

2948

Surgery Count

Q1 FY20

3141

6429

1182

1205

145

1605

1129

271

6+ Years

4-6 Years

2-4 Years

<2 Years

6+ Years

4-6 Years

2-4 Years

<2 Years

6+ Years

4-6 Years

2-4 Years

<2 Years

6+ Years

4-6 Years

2-4 Years

<2 Years

www.shalby.org

FINANCIAL PERFORMANCE

www.shalby.org

KEY FINANCIAL PARAMETERS – Q1 FY20

Revenue (INR Mn)

EBITDA (INR Mn)

PBT (INR Mn)

PAT (INR Mn)

1337.2

311.5

275.0

13%

209.7

18%

13%

1187.4

236.6

95%

121.3

177.8

Q1 FY19

Q1 FY20

Q1 FY19

Q1 FY20

Q1 FY19

Q1 FY20

Q1 FY19

Q1 FY20

ARPOB (INR/Day)

ALOS (Excluding Daycare)

31,141

32,154

4.19

4.24

Q1 FY19

Q1 FY20

Q1 FY19

Q1 FY20

www.shalby.org

FINANCIAL HIGHLIGHTS – Q1 FY 20

Particulars

Revenue from Operations

Other Income

Total Income

Expenses

Materials & Consumables

Fees to Doctors and Consultants

Other Operative Expenses

Employee Costs

Administrative Expenses

Advt. & Promotion

Total Operational Expenses

EBITDA

Finance Cost

Depreciation & Amortization Expense

Profit before tax (PBT)

Tax Expense

Profit after tax (PAT)

Q1 FY19

% of Revenue

Q4 FY19

% of Revenue

Q1 FY20

% of Revenue

Growth (y-o-y)

Growth (Q-o-Q)

1,159.7

27.7

1,187.4

298.2

276.3

44.8

206.3

67.6

19.3

912.4

275

14.6

82.6

177.8

56.5

121.3

1126.8

27.1

1153.9

25.1%

23.3%

3.8%

316.5

328.7

35.3

17.4%

217.1

5.7%

1.6%

76.8%

23.2%

10.2%

69.5

16.9

984.1

169.8

22.1

78.8

68.9

35.0

33.9

1317.7

19.5

1337.2

345.1

337.9

44.1

214.0

66.8

17.8

1025.7

311.5

13.2

88.5

209.7

-26.9

236.6

27.4%

28.5%

3.1%

18.8%

6.0%

1.5%

85.3%

14.7%

2.9%

14%

-30%

13%

16%

22%

-1%

-8%

12%

13%

17%

16%

25%

-1%

-4%

83%

25.8%

25.3%

3.3%

16.0%

5.0%

1.3%

76.7%

23.3%

18%

204%

17.7%

95%

598%

www.shalby.org

REVENUE & SURGERY MIX – Q1 FY20

3%3%

22%

Speciality Mix

57%

Payer Mix

46%

26%

11%

16%

2% 3% 3%

Surgery Mix

53%

Arthroplasty Cardiac Science Oncology Critical Care & General Medicine Orthopaedic Neurology General Surgery Nephrology Others

Self Pay

Corporate Government

TPA

Corporate Private

Arthroplasty Orthopaedic Nephrology General Surgery Cosmetic & Plastic Surgery Oncology Cardiac Science Others

www.shalby.org

MATURITY PROFILE - Q1 FY20

OPERATIONAL PARAMETERS

Parameters

6 Years+

4-6 Years

2-4 Years

<2 Years

Total Bed Capacity

Operational Beds

Avg. Occupied Beds

Occupancy ( % )

594

437

162

37%

476

330

138

42%

747

324

137

42%

145

27%

FINANCIAL PARAMETERS

Parameters

Revenue Share

Arthoplasty

Non-Arthoplasty

EBITDA %

ARPOB ( RS. )

ALOS ( DAYS )

6 Years+

4-6 Years

2-4 Years

<2 Years

47%

33%

14%

32.9%

42,874

4.36

19%

14%

10.5%

20,190

4.58

29%

16%

13%

20.8%

31,463

3.85

-8.0%

32,617

4.15

Total

2012

1200

457

38%

Total

100%

57%

43%

23.3%

32,154

4.24

*6 Year+ : SG, Krishna, Vapi, Vijay I 4-6 Years: Indore, Jabalpur I 2-4 Years: Jaipur, Naroda, Surat I <2Years: Mohali

www.shalby.org

OTHER KEY UPDATES

www.shalby.org

TECHNOLOGY TRANSFORMATION

 Implementation of advanced Hospital Information System (HIS) has been started in phased manner, complete implementation is expected to finish in next 7-9 months.

 Implementation of SAP ERP (SAP S4 HANA) also initiated, complete implementation is

expected to finish in next 8-10 months.

KEY BENEFITS

 Improve Quality of Patient Care and Safety

 Streamline Hospital Operations and Improve Efficiencies

 Facilitate Process Standardization and Great Customer Experience

 Enable Growth

www.shalby.org

OUR BUSINESS MODEL – FEATURES OPTIMISING CAPEX AND OPEX

and

planning

Lowest Capex and Opex per bed due to optimal use of real-estate Equipment utilities planning In-house planning teams Focus on surgeries with higher ARPOB, better margins and return ratios Centralised procurement Gradual capacity Fully owned or O&M on revenue sharing (no fixed rentals, no security deposit or MG)

ramp-up of bed

www.shalby.org

Optimize capex planning with Inhouse projects team

Cost per bed ~ Rs. 3.5 millions

Operational Efficiency due to better capex planning

EBITDA upwards of 20% which is higher than industry average

Utilities planning to optimize capex

Better utilization of space [and expensive real estate]

Low consumable cost

Leveraging economies of scale through centralized procurement

TYPICAL CONCEPT OF 200 (±20%) BED CAPACITY SET-UP

Facilities 10-15 kms away

Local and Natural Footfalls from 4-5 kms radius helps to fill up ~50% beds

Balance ~50% – patients come in the name of doctors reducing thereby dependency on star doctors thus controlling doctor payout %

www.shalby.org

OUR BUSINESS MODELS…

Fully Owned

Efficiency is paramount

Hospital Manageme nt Contracts

Operate and Manage [Revenue Sharing]

No fixed rental

Unique revenue sharing model

No security deposit

No minimum guarantee

www.shalby.org

ROLE OF OPDS FOR EXPANSION

Patients visit our clinics across India and abroad

We analyze patient trends and accordingly decide where to expand

So we can start the facility with low branding budget but high brand recall

Punjab

Rajasthan

Gujarat

Ahmedabad

Madhya Pradesh

Maharashtra

Simultaneously hire local doctors and train them at Ahmedabad who conduct OPDs in and around that city

Set-up outpatient clinics where we have a strong brand recall

Operating such Outpatient clinics for 15 years now

www.shalby.org

THE OPPORTUNITY SET

Population and Population Growth Rate of India (Historical and Expected)

Spilt of Indian Healthcare Industry by Segments

100%=

1.27 billion1.29 billion

1.32 billion

1.35 billion

54+ years

100%

35-54 years

20-34 years

0-19 years

80%

60%

40%

20%

Total market size (2016): INR 9.2 trillion

13%

68%

CAGR (2014-2020)

0.9%

2.6%

1.6%

0.7%

-0.04%

2014(E)

2016(E)

2018(E)

2020(E)

Healthcare Delivery-Hospitals

Diagnostics

Pharma

Health Insurance

Medical Devices

www.shalby.org

THE OPPORTUNITY SIZE

Spilt of Public and Private Hospitals in India

Indian Healthcare Delivery Industry size (2015-2020) (INR in Trillion)

30%

70%

11.7

8.5

7.3

6.2

5.4

Public Hospitals

Private Hospitals

2015

2016(E)

2017(E)

2018(E)

2019(E)

2020(E)

Private Corporate Hospitals account to less than 10% of the total Private Hospitals

www.shalby.org

RECENT TRANSFORMATION

 Private sector investment has been increasing due to change in mind-set and better returns on

investment

 Healthcare businesses can also be profitable as long the costs are affordable  The advent of information technology has given a fillip to the healthcare business making it both

controllable and scalable

 Rising aspirational middle-class today is not averse to paying for quality healthcare services  Impact of health insurance, government schemes and emergence of medical tourism - key drivers

of positive change

 Healthcare today in India is evolving to be a larger consumer story

than ever before

www.shalby.org

CASE STUDY - THE CARDIAC GROWTH STORY IN INDIA

2014 ~ 2,00,000 surgeries and 8,00,000 angioplasties

2004 ~ 50,000 surgeries

1994 ~5000 surgeries

1984 ~500 surgeries

CAGR – 29% in 30 years. Currently growing @ 2-3%

Wide procedure penetration – to Tier 2 and 3 cities

www.shalby.org

KNEE REPLACEMENT - THE BIG OPPORTUNITY

2017 ~1,75,000 surgeries

2010 ~54,000 surgeries

2000 ~6000 surgeries

1994 ~300 surgeries

Last 1year, In United States ~0.8 mn knee replacements in a population of ~300 mn

India has a similar affording population. Hence, direct potential to grow to 8 lacs Knee replacements

Hence huge potential for growth based on incidence rates

Asian population 15 times more prone to Arthritis of knee than their western counter parts

Surgery Count CAGR @32% in 23 years

www.shalby.org

GROWTH DRIVERS FOR SHALBY

Pioneer in Joint Replacements in the country, best positioned to capitalize on it

Opportunities within Homecare

Huge scope for

organic growth and operating leverage

Continue to gain traction within Oncology and Neurology

Cardiac Sciences, and Critical Care

Increasing focus on quaternary treatments like organ transplants such as Liver, Heart, Lungs and Kidney

www.shalby.org

CONDUCIVE GOVERNMENT POLICIES DESPITE CHALLENGES

realization

Smriddha Bharat. Demographic proper

Swastha Bharat, dividend healthcare Rashtriya Samaj Beema Yojana: 100 mln families will get Rs 500,000 per year for their families to cover secondary and tertiary hospital expenses

impossible without

100% depreciation on capex incurred, MAT credit can be availed for 15 years, all healthcare education and training services exempted from GST

Wide procedure penetration – to Tier 2 and 3 cities

State Policies include capital subsidy on purchase of medical equipment, capital subsidy on investment tertiary-care hospitals and interest construction of subvention, along with several other benefit

www.shalby.org

THANK YOU

Shalby Limited I Opp Karnavati Club I S G Highway I Ahmedabad - 380 015 I India.

www.shalby.org

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Shalby Limited has informed the Exchange regarding Investor Presentation on financial and operational performance for quarter ended June 30, 2019

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