The Noida-headquartered real estate and infra major Jaypee Group plans to diversify into healthcare by investing in excess of Rs 2,000 crore over the next 3-4 years to set up a hospital chain with a minimum capacity of 3,000 beds.
This investment doesn’t include a major chunk of the cost of the land, given that the group intends to develop tertiary and super-speciality hospital facilities in cities where it already owns land parcels.
The founder of the group Jaiprakash Gaur told ET that five years down the line, he wants healthcare to become the core business of the group. His daughter Rekha Dixit and an industry veteran Vikram Singh, formerly COO at Wockhardt Hospitals, would take his vision forward under Jaypee Healthcare, a company in which the promoter group would hold a significant equity.
The first such 1,200-bedded facility will come up in Noida, with an investment of over Rs 500 crore, said Dixit, adding that it has just begun operation in parts. “It’s a large facility with state-ofthe-art equipment and we plan to kick off operations of different specialities in phases,” she said.
Singh told ET that the group would employ a two-fold strategy. “First, we have zeroed in on cities where the group owns big land parcels and where there’s acute need for healthcare,” he said.
So besides Noida, the group has decided to float a hospital chain in northern India, covering cities such as Agra, Bulandshahr, Kanpur, Sahibabad, where it plans to build 500-bedded and 250-bedded large hospitals.
The second plan is to build relatively smaller hospitals and medical centres along the Yamuna Expressway, built by the group. Singh claims that the money spent on technology per bed for the group is the highest in the country, when pitted against rivals.
“We have also partnered with the Huron Consulting Group which advises the likes of Harvard and other top US hospitals,” he said. Gaur said that though his formal entry into hospital business may be happening now, he is no novice to the healthcare sector.
“We run close to 40 dispensaries across locations where we offer free medical services to our workers and people from neighbouring villages,” he said. “I realised how badly we needed good medical care when as a five-year-old, my dad and I walked long miles to visit a dentist, who ended up extracting the wrong tooth. Things have changed since then, but not as much as they should have, particularly in healthcare.”
At less than one hospital bed per 1,000 people, India faces an awful shortage in healthcare facilities and performs much worse than China, Brazil, Sri Lanka on this indicator. The bed-to-population ratio is lower than what the World Health Organisation recommends as a minimum requirement, and way below the global average of 2.9 beds per 1,000 population.
Gaur said in 1972, he was very keen to start a pharma business and had explored possibilities, but things didn’t work out for him. Today, his dream is to build the world’s best healthcare facility.
“By that I mean, it should offer the latest and best-in-class therapy, have a human and caring touch which should be reflected in the behavior of its employees and adopt an honest approach to pricing,” he said.