Max India Limited Investor Presentation November 2018 - - PowerPoint PPT Presentation
Max India Limited Investor Presentation November 2018 www.maxindia.com Max Group Vision To be the most admired corporate for service excellence Positive social impact Culture of Service Sevabhav Helpfulness Mindfulness
Investor Presentation
November 2018
www.maxindia.com
Max Group Vision “To be the most admired corporate for service excellence”
Sevabhav Excellence Credibility
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2 Note: USD rate considered at 64
Evolution of Max Group—Strong history of entrepreneurship and nurturing successful businesses
Health & Allied Business Life Insurance Business*
Max Group – Corporate Structure
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Max Group ‐ Sponsors
Manufacturing & Other businesses Holding Companies Operating Companies
70.75% 50% 51% 100% 51%
Group CSR Arm
30.3% 41.0% 47.2%
Sponsors stake in Max Group holding companies
100% 100% 100%
4 Rahul Khosla
Mohit Talwar
Rajit Mehta
Tara Singh Vachani
Ramneek Jain
Mohini Daljeet Singh
Rajesh Sud
(upto December 31, 2018)
Max Skill First (upto March 31, 2019) Ashish Mehrotra
Sahil Vachani
Rajender Sud
Prashant Tripathy (with effect from Jan 1, 2019)
Max Group – Senior Management
Max Group Overview
USD 3 billion+… 10 Mn Customers… 25,000 Employees… ~80,000 Agents… 3,000 Doctors… Strong growth trajectory even in challenging times; a resilient & diversified business model Steady revenue growth and cost rationalization leads to strong financial performance Well established board governance….internationally acclaimed domain experts inducted Diversified ownership…..marquee investor base Superior brand recall with a proven track record of service excellence Strong history of entrepreneurship and nurturing successful business partnerships
1 2 3 4 5 6 7
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Max Group : Continues to grow from strength to strength
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Group EBITDA (USD Mn)
81 95 110 127 129 FY'13 FY'14 FY'15 FY'16 FY'17
Group Revenue (USD Mn)
1,639 1,915 2,190 2,584 2,945 FY'14 FY'15 FY'16 FY'17 FY'18
Max India: High pedigree investor base
Number of outstanding shares* : 26.84 Cr.
Promoters 41.0% IFC 3.1% FII/ FPI 23.6% Mutual Funds 18.7% Others 13.6% 0.0% 0.0% 0.0% 0.0% Shareholding Pattern as on Sep 30, 2018
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Shareholding concentrated with Marquee Investors
* Max Group Sponsors hold warrants convertible into 4% equity stake, post conversion Sponsor’s stake will increase form 41% to 45%, on fully‐diluted equity base will increase to 28.7 Cr shares post conversion
www.maxhealthcare.in www.maxindia.com
MAX INDIA LIMITED
MAX HEALTHCARE
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Sources: India Brand Equity Foundation – Healthcare report, July 2017, BofA Merrill Lynch Global Research
60 79 160 280 2010 2012 2017 2020 2025 2025 Indian healthcare sector * Estimated size, Bn USD Demand drivers for growth
* Includes hospitals, pharmaceuticals & medical technology / other companies
~500 mn
additional middle class by 2025
~45%
Insurance penetration by 2020
~134 mn
population > 60 years by 2020
~$8 bn
medical tourism market size by 2020
~320 mn
at risk of dying due to NCDs by 2020
~2 mn
beds required by 2025
CAGR
15.0%
CAGR
16.5%
Business As Usual Aspirational
320-340 450-470
Indian healthcare industry is expected to reach ~$470 billion fuelled by multiple demand drivers
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Sources: BofA Merrill Lynch Global Research, IBEF Mar'15 Private players have established a dominating presence in tertiary / quaternary care 70% 63% 60% 78% 80% 30% 37% 40% 22% 20% Market Share Beds Inpatients Outpatients Doctors Private sector Public sector
70% 20% 10% Hospitals Pharmaceuticals Medical technology / Others Indian healthcare sector* Market share %
Market size of private hospitals is expected to reach ~$ 120 bn by 2020 22 36 81 120
2009 2012 2015 2020
Private sector hospitals Estimated size, Bn USD
CAGR ~24% CAGR ~20%
* Includes hospitals, pharmaceuticals & medical technology / other companies
Hospitals constitute ~70% of Indian healthcare market with increasingly dominant role of private sector
1
At current level of public sector spending the scenario is not likely to change
1.15% 1.40% 1.30% 1.20% 2.50% FY14 FY15 FY16 FY17 FY20-22
Source: LiveMint research, World Bank database, Hindustan Times
5%+ WHO guidelines
India- public spend on Healthcare % of GDP
~8% USA 8-10% Developed countries 3.5-4% BRICS- excluding India
Hence, Government will keep shifting the burden of public health provision towards private sector
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The surge of VC/ PE investments in recent years has eased funding constraints on growth
Annual VC/ PE investment’s in India’s Healthcare ($ Million)
Recent examples
Source: Crisil research, company websites and presentations, secondary sources
deals 35 29 65 60 54 580 495 1,262 1,359 900 1,584 1,111
2016 2013 2015 2014 2012 2010 2011 ~3x
50 86
TARGET INVESTOR AMOUNT DATE
$221 mn Jan ‘16 May ‘16 Dec ‘16 $68 mn $63.5 mn
TARGET INVESTOR AMOUNT DATE
Jul ‘17 Aug ‘17 $43 mn $171 mn
Competition is intensifying with scale‐up of well funded incumbents & availability of capital for new players
$200 mn Jul ‘17
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Jul ‘18 $571 mn
MHC vision
KEY ENABLERS WHERE DO WE WANT TO BE WHAT WILL WE BE KNOWN FOR
clinicians, nurses and healthcare leaders
analytics enabled clinical outcomes and customer experience
continued care
chosen geographies
Quaternary care
North India; however serving more than 300 towns in India and 30+ countries
To deliver international class healthcare with a total service focus, by creating an institution committed to the highest standards of medical & service excellence, patient care, scientific knowledge, research and medical education
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MHC is a dominant player in North India 410 519
Saket Noida* Gurgaon Vaishali Shalimar Bagh Max Smart
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OUTSIDE NCR NCR
Patparganj
250
Mohali Bathinda Dehradun
186 172 293 224 280
Pitampura* Panchsheel* Lajpat Nagar*
* Standalone Speciality Clinics with Outpatient and Day care facility
Greater Noida
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~2500 available beds across the network
MHC has invested in state of the art equipment to achieve clinical excellence (1/2)
Advanced robotics provides high precision, and minimum invasive surgery across multiple specialities such as Oncology, Neurology High dose radiation with extreme precision (~ 0.5 mm accuracy) Advanced image guided surgery - provides real-time views and automated image processing Provides precise correlation and facilitates proper treatment for Oncology, surgical planning and radiation therapy
Robotics Brain suite Novalis LINAC PET-CT
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MHC has invested in state of the art equipment to achieve clinical excellence (2/2)
Robotic radio-surgery (non-invasive) system for both cancerous & non-cancerous systems Designed for revolutionary single incision laproscopic surgery through catheter-based, flexible instruments Economical digital storage and convenient access to medical images from multiple modalities
CyberKnife* Picture Archiving & Communication System - PACS SPIDER
* planned
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MHC has a robust service excellence & quality framework which has resulted in enhanced customer experience
Recognition platform has led to positive shift in mindset
Sigma and other methodologies has resulted into business impact of over USD 18 Mn 57% 69% 73% 80% FY`15 FY`16 FY`17 FY`18
Top 2 Box Rating*
* MHC is the only healthcare company who has deployed a third party (IMRB) to conduct Satisfaction survey
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MHC strong Governance Model helps us bring alignment and improve accountability
Executive Committee Unit Heads Unit Management Committee (MANCO) Group Medical Advisory Council (GMAC) Hospital Medical Executive Council (HMEC) Doctor’s council Managerial Clinical Administration Nomination & remuneration Audit Investment & performance review Medical excellence & compliance Service excellence Scientific projects & technology Corporate social responsibility Board & 7 committees
Governance
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MHC has a proven record of building an institution
NABL/ NABH accredited ISO 9001:2000 & ISO 14001: 2004 certified DL Shah National Award on ‘Economics
FICCI Excellence Awards - Operational Excellence Leadership positions in NatHealth and CII - healthcare
First MHC hospital started in 2002 MHC is one of the top 3 healthcare chains in India
Strengthened capabilities to provide comprehensive tertiary & quaternary care Network of highly qualified doctors, nurses and medical personnel Organic growth through expansion of hospital network JV with Life Healthcare, South Africa, extending expertise and global reach Business World Healthcare Award in Patient Experience & Safety Max Saket received JCI accreditation – highest standards of clinical governance and compliance
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MHC won 32 awards across multiple impact categories from various prestigious institutions in FY17 and FY18
Clinical Safety (7) Operational Excellence (9) Service Quality (10) Others (6)
Healthcare
savers’ project (Max Bike responder) at ‘American Society for Quality’
CII Institute of Quality
Healthcare
(reducing carbon foot print
initiative (prevention of patient fall)
(BCMA medication process improvement )
Achievers Award
brand
and development
20
FY18 has been a year of reset caused by various regulatory interventions and
control
impacts (ESIC coverage, bonus notification, etc)
consumables and implants (Delhi govt led) Sustained impact One time impact
multiple incidents in the sector during Q3/Q4
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MHC Annual Gross Revenue
2787 2567 2181 1739 1407 1149 FY17 FY18 FY14 FY13 FY15 FY16 +22%
MHC Annual EBITDA
222 281 221 173 113 70 FY17 FY18 FY14 FY13 FY15 FY16 +42% 6.2 8.3 10.2 10.5 11.4 8.5 xx EBITDA Margin
Phase 3
Recalibration driven by regulatory interventions
Phase 2
Large inorganic acceleration, but with some margin dilution
Phase 1
Rapid organic expansion and profitability through
FY18 has been a year of reset caused by various regulatory interventions and
FY16 excludes Rs. 6 Cr. of one time expenses towards the Pushpanjali and Saket City acquisitions; FY15 excludes Rs 3 Cr of one off expenses 22
MHC Annual Gross Revenues by hospital complexes
568 593 666 779 954 1067 733 672 560 381 309 827 260 FY13 FY16 FY15 1800 1626 1339 1047 FY17 FY14 902 +18% FY18
MHC Annual EBITDA hospital complexes
81 82 102 114 121 122 75 90 76 53 44 197 +15% 212 190 FY14 155 FY13 121 40 126 FY18 FY16 FY17 FY15 16.1 15.1 14.7 14.4 14.3 11.2 Saket Complex East delhi complex xx
EBITDA Margin
14.7 14.3 15.6 15.1 13.3 12.2
Note: Saket Complex includes Saket West Block, Saket East Block (unit of Devki Devi Foundation) and Max Smart (unit of Smart Hospital & Research Centre) hospital; East Delhi Complex includes Max Patparganj (unit
Phase 3
Recalibration driven by regulatory interventions
Phase 2
Large inorganic acceleration, but with some margin dilution
Phase 1
Rapid organic expansion and profitability through
FY18 has been a year of reset caused by various regulatory interventions and
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Strong momentum across all volume and value levers in last 5 years
Maintained healthy occupancy levels despite strong bed addition momentum Steady growth in Revenue per occupied bed Consistent focus on key tertiary tower specialities Consistent improvement in Average Length of Patient Stay
Figures in Rs. Thousands Per OBD
908 1,094 1,235 1,457 1,737 592 651 640 1,679 445 FY18 2,330 +13% FY17 FY16 2,377 FY13 FY14 1,302 394 1,472 FY15 1,680 2,049 378
+6% 44 39 34
FY17 FY14
41
FY18 FY15 FY13 FY16
37 33 3.3
FY15
3.1
FY17
3.2
FY18 FY16
3.5 3.4
FY13 FY14
3.5
Figures in Number of days
NOTE: FY16 and FY17 including Vaishali and Saket City Hospital; Cardiac revenue impacted by stent price capping in FY17 and FY18; Ortho revenue impacted by implant price capping in FY18
FY16
13% 9% 10% 11% 55% 54% 14% 13% 10% 10% 0%
FY17
12% 8% 7%
FY15
56% 13% 4% 10% 12% 7% 5%
FY13
6% 53%
FY14
14% 10% 10% 8% 11% 51% 10%
FY18
52% 7% 14% 2% 10% 6% 15% 12% 2% 3% 3% 3% 2% 2% Neuro Renal Ortho LBS Cardiac Onco MAMBS
72.1 71.1 73.5 74.3 69.7 73.1
beds
beds Occupancy (%)
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Four dimensions to value creation for MHC
Existing network
ion Hospital network growth Alternate models Key enablers
international direct models / PSU closures
scale / occupancy growth
personnel, material and clinician cost
to 5000+ beds
positioning
25
TRANS- PLANT
Drive increase in share of preferred specialties to improve profitability
Reduction due to acquisitions with weak starting positions and value erosion in cardiac / ortho specialties due to price controls Action plan in place to grow focused specialties Healthcare revenue specialty share Percent
in all DMGs
standalone centre model
ONCOLOGY
NEURO SCIENCES CARDIO SCIENCES
center in Saket complex
selected locations
institutions – people & best practices 44% 48% 56% 52% 1,720 Cr. Preferred 2,717 Cr.
100%
Others FY15 FY18 14 20 xx CAGR (%)
A
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Our aspiration is to have a preferred mix of 54.0 – 55.0% in FY22
Drive increase in share of preferred channels to improve profitability
Reduction in preferred channels due to acquisitions with weak starting positions Action plan in place to increase the share of preferred channels
Preferred Channels Non-preferred Channels
Healthcare revenue channel share Percent
Walk‐in Inter‐ national
delivery on new positioning
through digital platforms
TPA
prevention/ wellness space
targeted at new customer segments
footprint in select markets
models such as surgeries abroad / O&Ms
MECP Institutional
field force; strong focus on salesforce effectiveness
through focus on collections, material cost, and ALOS
18.2% 22.0% 17.9% 18.4% 40.3% 36.0% 14.0% 13.2% 9.7% 100.0% TPA 100.0% FY18 MECP Institutional/ PSU International 10.3% FY15 Walk-In
A
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Our aspiration is to have a preferred mix of 72.5 – 73.0% in FY22
structured cost initiatives; Rs. 64 Cr. targeted in FY19
8 21 20 19 25 35 12 12 18 58 FY18 FY17 73 FY16 39
efficiency improvement and demand management
Material Costs Other Indirect Costs Personnel Costs (Incl. Clinicians)
A
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MHC expansion prioritised in hospitals with demonstrated track record of superior profitability
East Delhi complex: 106 Saket complex: 10 Gurgaon: 8 Saket complex: 1100* East Delhi complex: 200 Mullanpur: 400
* Includes 200 beds of Saket FAR
B
504 2,080 Current Bed Capacity FY19 FY23 & Beyond 124 FY20 FY21 FY22 Total 2,529 5,237
Saket complex: 315 S.Bagh: 104 Mohali: 85
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Expansion prioritized in facilities that have a proven track record of delivering 15-16% EBITDA margin in the past
Max Healthcare Bed Capacity
9.2 36.0 51.8 61.8 216.4 218.5 275.3 439.2 421.4 389.6
14th June'16 July'16 Aug'16 Sep'16 Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18
Rev - Actual
Onco Day Care Center: Operationalized in July’16, EBITDAR break even on the 3rd month
B
the hospital to ensure comfort and care for our patients during chemotherapy sessions
disease by providing a non‐hospital environment and a highly efficient and expert experience
skills
21st June’16 Chemo started Saket doctors OPD started 7th July: X‐ray started
1st Sept: Ultra‐sound started
FY’18 EBITDAR margin of 18.7% and EBITDA margin of 9.9%
0.1 0.4 0.6 0.8 0.9
June'16 Q2'17 H2'17 H1'18 H2'18
Daycare Chair turnover IMRB Scores
Pan MAX 76% Oncology 79% Onco DayCare 91%
Channel Mix (FY’18)
Cash 44% TPA 20% Others 36%
Success of this centre has paved the way for opening more such centres; Work on for the 2nd
Figures in Rs. Lacs
30
Immigration Center: Revenue growth at 53% vs. LY
B
17.0 11.1 7.0 FY’18 FY’17 FY’16 122.3 77.6 62.0
FY’17 FY’18 FY’16
Revenue (Rs. Cr.) Volume (‘000)
New Center
Figures in Rs. Cr.
Success of this centre has paved the way for opening more such centres; Work on for the 2nd one in Mohali
31
Max Lab: MHC has shown consistent growth in the non‐captive business
C
Network Expansion
Uttarakhand
Technology
creation, Partner management
implementation underway
Operations
Organization
Building blocks in place to achieve the growth aspiration
2.9 2.2 7.7 5.4 H2’18 H1’17 H2’17 H1’18 +241% 102.9 55.1 21.5 10.3 H2’17 A H2’18 A H1’18 A H1’17 A +901%
Samples* (‘000) Revenue (Rs. Cr.)
* Pathology samples from Max@Home are also included
32
Max@Home: With Rs. 1.5 – 2 Cr. of investment till date, business stands at ~Rs. 28 Cr. revenue in FY18
C
Home Sample Collection
Q4
Medicine home delivery
Critical care nursing
in Q4
New territory‐ Mohali
and pharmacy delivery
Max@home B2C platform
Revenue (Rs. Cr.)
New services Existing services
0.26 3.88 6% 94% 7.14 20.41 74% 26% 2.74 2.75 50% 50%
Volumes (‘000) Steady state EBITDA margin ~25%
27.6 9.6 10.4 +165% FY 18 FY 17 FY 16 41.9 38.5 31.3 19.6 13.2 Q3’18 A Q2’18 A Q4’17 A Q4’18 A +218% Q1’18 A
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Teleradiology and Physiotherapy BU: Launching 2 new businesses in FY19 with high market potential
C Tele Radiology Physiotherapy BU Market potential MHC’s plan
growing market at ~18‐20% CAGR (FY11‐16) driven by digitally enhanced healthcare infrastructure and integration of teleradiology; market size of USD ~1.2 bn in FY18
radiologists; project growth in FY18‐22 at 15‐ 20%
(FY11‐16) driven by widening network of high‐speed broadband services, shortage of radiologists in tier‐2 cities , etc.
international markets
signed within 6 months of operations
~1.0 bn in FY20
(estimated to reach 323 mn by 2050), chronic illnesses & increase in awareness
includes services @home and clinics), while hospitals focus primarily on their in‐patients
and standardization of service delivery
physiotherapist that is additionally signed off by the treating clinician
Sports physiotherapy, Mental Health etc.
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www.maxbupa.com www.maxindia.com
MAX INDIA LIMITED
MAX BUPA HEALTH INSURANCE LIMITED
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A symbiotic partnership in health insurance
Helping people live longer, healthier, happier lives
What we do Highlights
Domestic Health Insurance Global Health Insurance Dental and Travel insurance Advice Primary Care Clinics Dental clinics Aged Care
► Leading international healthcare group present across 190+ nations, provides personal and company health insurance, runs care homes for the elderly and hospitals in addition to a range of health services ► Founded in 1947 in the UK, Bupa employs over 86,000 people across UK, Australia, Spain, Hong Kong, Poland, New Zealand, Chile, Brazil, Thailand, Saudi Arabia, India and the US ► Revenues of over £11 billion, over 70% coming from health insurance covering over 16.5 million customers ► Diversified group with interests in insurance, healthcare, manufacturing, real estate, learning and senior living ► Founded in 1985 with an entry in the bulk pharma business, Max has evolved into one of the leading health services organizations in India ► Over INR 191 billion in revenues, serving over 10 million customer with 25,000 employees and 3,000 doctors.
Max Bupa is a 51:49 joint venture between Max Group and Bupa
In the business of Life
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Our Vision and Mission
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To be the most admired Health insurance company in India To help customers live healthier, more successful lives
Caring Respectful Ethical Accountable Trustworthy Enabling
Health insurance retail landscape
Source: KPMG
Rising affluence and urbanization Ageing population Increasing medical cost & high OOP Internet penetration and E‐ commerce growth 158 630 FY'18 FY'25 22%
Retail Health Insurance – Market Size
(GWP INR Billion)
Rise in chronic disease incidence
Factors driving growth
current level of 8%
household vs. 0 cities currently
years by 2030
along with evolution of product suite
vascular diseases (CV) and diabetes
expenditure which is expected to grow further
with high out-of-pocket expenses (62%) expected to drive demand further
current ~390 M
expected to drive break-out digital channel growth
The retail health insurance market is expected to reach INR 630 billion by 2025 growing at a CAGR of 22%
38
Industry landscape
Segment‐wise GWP (INR Cr)
Industry growth during FTY Aug’18* SAHI growth during FTY Aug’18* MBHI growth H1 FY’19
24%
Overall sales growth
38%)
1,950 2,629 430 662 B2C 3 FTY Aug’18 2 B2G FTY Aug’17 B2B
2,383 3,293
38% 5,479 6,526 7,563 1,106 FTY Aug’18 FTY Aug’17 B2C B2G B2B
14,148 16,833
1,082 19%
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18,388
* Industry numbers are excluding PA revenue; The HI market including PA is worth Rs 19,131 Cr and has grown by 20% over last year; SAHIs contribution (including PA) is to the tune of Rs 3,561 Cr and have grown by 39% over same period last year
Journey since inception
GWP, Rs cr Channel Service model
business in FY’12
claims processing
scheme won
annual brand property
(Deutsche bank)
providers
settlement (92% cases)
Banca partnerships
xx%
Y-o-y growth CAGR
national touching 33 MM lives
(Sarv UP, Muthoot, Coverfox, Bank Bazaar)
Segment
Baroda serving more than 5,400 branches
for auto renewal
product launched at Federal bank
FY10-12 FY12-13 FY13-14 FY15-16 FY16-17 FY14-15
207 309 373 476 66% 53% 18% 28% 594 125
FY17-18
25% 755 27%
FY18-19*
404
enabled product ‘GoActive’ launched
business with South Indian bank
first “Any time health” machine
care desks for customer delight
40
business with HDFC bank and Karur Vysya Bank
* For H1 FY’19
Customer mobile application
Healthy growth with consistent improvement in combined ratio
the B2C segment since inception
B2C book (linear customer acquisition vs. lumpy demand
grown at 27%, faster than market (market growth ~23% for FY’18)
model choices and some execution challenges have resulted in higher upfront opex spend
Combined Ratio* (%) Gross written premium (Rs cr)
* Combined ratio = Claim ratio (Net claim incurred / Net Earned premium) + Opex ratio (Opex / GWP) + Commission ratio (Net commissions / GWP)
151% 142% 127% 118% 116% 109%
2012‐13 2013‐14 2014‐15 2015‐16 2016‐17 2017‐18
162 245 354 466 736 584 1 8 7 4
2012‐13
207 38 4
2015‐16
476 6
2017‐18
+30% 755 14
2013‐14
309 56 4
2014‐15
373 18
2016‐17
594 6
B2C B2B B2G
Combined ratio for FY 17-18 basis IRDAI definition is 104%
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Max Bupa today
In a large, fast growing market Max Bupa delivers 2.8m customers, a vast distribution network and leading brand
1,900 employees 30 branches 9 banca partners with 13,400 branches accessing 101mn customers 13,900 agents 98% B2C business 4,064 providers in network 62mn* lives touched through Walk for Health (2017-2018) 1st of its kind, Digitally enabled wellness product - GoActive ~2.8m total customers GWP Rs. 404 cr (H1 FY’19) 24% Growth (H1 FY’19)**
Focus on B2C segment from inception Investments in direct channels to support the “pull” model; Premium infrastructure (office locations and size) in line with overall positioning Launched first to industry innovations – Any Time Health Machine; Complete digitally enabled wellness ecosystem; Highest Sum Insured
Guaranteed renewability; No 2 year waiting period Max Bupa is the only insurance company with an annual brand property - Walk for Health initiative Customer service is a key focus area – ~78% of customers rate claims experience with Max Bupa as very good
*Duplicate reach across mediums **Growth over same period last year
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Comprehensive product suite
Key features include hospitalization costs including: ► State of art coverage - Cashless international coverage (market first) ► Lowest (2 years) pre-existing disease waiting period ► Out Patient benefits ► AYUSH benefits ► Maternity & New Born benefits ► Coverage from Day 1 for accidents ► Waiver of 24 months waiting period for specific conditions below 45 yrs ► Loyalty benefit at renewal Our flagship indemnity product with the most comprehensive coverage
Heartbeat
Key features include hospitalization costs including: ► No limit on room rent and pre and post hospitalization expenses ► Added protection with Unique Refill benefit ► All day care procedures covered ► Unmatched renewal benefits − No Claim Bonus (No reduction in case of claims) − Health check ups to help keep track of the health condition ► AYUSH in-patient treatment ► Super top up An indemnity product with refill benefit, alternative treatments & Extended Family First proposition
Health Companion
Accident Care: ► Accidental death benefit ► Accidental Permanent Total Disability ► Accidental Permanent Partial Disability benefit Critical Illness: ► Covers 20 critical illnesses ► 2 options: Lump sum & Lump sum + staggered pay-out for 5 years Hospital Cash: ► Daily cash benefit & double cash benefit for ICU A fixed benefit product with unique 3-in-1 combination of personal accident, critical illness & hospital cash
Health Assurance
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Comprehensive product suite
Group Health Insurance includes: ► Group cover for hospitalization benefit Group Personal Accident: ► Accidental Death , Permanent Total & Partial Disability Loan linked group critical illness ► Loan linked cover for 25 critical illnesses ► Single pay up to 5 years Group medical cover ► Customizable product for employer employee groups – B2B A group product with customized propositions by selecting from over 35 product features and parameters
Group Platform
44 Key features includes: ► Lifetime discount of 10% of premium if purchased at or before 35 years age ► Upto 10 OPD consultations included in the cover ► Health coach option to enable customers remain fit and healthy ► Second medical opinion ► I-protect option to increase SI by 10% every year ► Annual health check- up/diagnostics of customers choice A digitally enabled, new age customer centric product
everyday health needs of the customer
GoActive
Distribution architecture
numbers amongst SAHIs
Bazaar – a leading industry player)
Agency Banca & Alliances Digital Direct sales
45
Internal
46 51% 23% 23% 2% 49% 27% 22% 2% 46% 29% 22% 3% Banca & Alliances Agency Others Digital & DST
Channel wise Performance (FY16 to FY18)
2016 2018 H1 2019
Channel mix Key highlights for channels over the last two years
headwinds on account of price revision of Heartbeat and Health Companion; Agency OTC app launched to enhance digital sales
registering a 37% growth over two years; MBHI has engaged in partnerships in last 3 years - Bank of Baroda, South Indian Bank, HDFC Bank and Sarv UP
area of MBHI and has seen a growth of over 22% between 2016 and 2018. DST repurposed running at a combined ratio of 100%, heading towards profitability.
increase across portfolio re-confirming customer confidence in the brand, products and services
centric product with an integrated wellness system
‘preferred product category’ based approach
for new sales
Others include B2B, B2G Internal
Innovations at Max Bupa
47
Digital innovations in H1 FY’19
48
Insta Insure Infinity Customer App Industry first digital ecosystem Web & Mobile application New platform for GHI
Internal
Strategic priorities – strengthening the foundation
Remarkable customer experience Profitable Growth Portfolio Management
Build Digital People First Customer Centric Profitable Growth
1 2 3 4 5
A B C D
Digitally enable end to end customer journey Build a Customer centric, Compliant & Cost conscious Culture Broad base the franchise with partnerships & alliances Provider of choice in the Affluent segment in urban India
49
Key Initiatives for FY19
50
External recognition
51
Disclaimer
This presentation has been prepared by Max India Limited (the “Company”). No representation or warranty, express or implied, is made and no reliance should be placed on the accuracy, fairness or completeness of the information presented or contained in the presentation. The past performance is not indicative of future results. Neither the Company nor any of its affiliates, advisers or representatives accepts liability whatsoever for any loss howsoever arising from any information presented or contained in the presentation. The information presented or contained in these materials is subject to change without notice and its accuracy is not guaranteed. The presentation may also contain statements that are forward looking. These statements are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ materially from our expectations and assumptions. We do not undertake any responsibility to update any forward looking statements nor should this be constituted as a guidance of future performance. This presentation does not constitute a prospectus or offering memorandum or an offer to acquire any securities and is not intended to provide the basis for evaluation of the securities. Neither this presentation nor any other documentation or information (or any part thereof) delivered or supplied under or in relation to the securities shall be deemed to constitute an offer of or an invitation. No person is authorised to give any information or to make any representation not contained in and not consistent with this presentation and, if given or made, such information or representation must not be relied upon as having been authorised by or on behalf of the Company any of its affiliates, advisers or representatives. The Company’s Securities have not been and are not intended to be registered under the United States Securities Act of 1993, as amended (the “Securities Act”), or any State Securities Law and unless so registered may not be offered or sold within the United States or to, or for the benefit of, U.S. Persons (as defined in Regulations S under the Securities Act) except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and the applicable State Securities Laws. This presentation is highly confidential, and is solely for your information and may not be copied, reproduced or distributed to any other person in any manner. Unauthorized copying, reproduction, or distribution of any of the presentation into the U.S. or to any “U.S. persons” (as defined in Regulation S under the Securities Act) or other third parties ( including journalists) could prejudice, any potential future
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ANNEXURES
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President – Max Group Seasoned business leader with over 30 years of deep global experience in Banking and Financial markets.
Managing Director at Max India Ltd. & Max Financial Services Ltd., Over 30 years of experience in Corporate Finance and Investment Banking.
Economist and Leading Academic Serves on Board of many Indian MNCs including Dr Reddy’s, Infosys, IDFC, Crompton Greaves, Cairn India Ltd. etc
Independent Director; Leading Finance professional associated with the development of Cost & Management Information Systems for over 150 firms
Managing Director & CEO- Max Healthcare Over 20 years of experience in financial services. Previously Chief Operating Officer at Max Life Insurance.
Partner at Artiman Ventures, focusing on early- stage technology & life science investments PhD in Computer Science from Columbia University
Director of Max Institute of Minimal Access, Metabolic and Bariatric Surgery. More than 35 yrs
Managing Director, Everstone Capital Asia (Singapore) Extensive global management experience; Bachelors in Economics from St Stephen’s College, Delhi and MBA from IIM Ahmedabad.
MHC ‐ Board of Directors
Non Executive Director and Group Executive, Strategy and Investor relations, Life Healthcare Group. Commerce and Law graduate and currently responsible at LHC for driving the international strategy. .Mr. Pieter Van Der Westhuizen Non Executive Director and Chief Financial Officer, Life
has fulfilled various financial roles
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Chief Executive Officer and Managing Director of Antara Senior Living A natural leader, she represents the dynamic new cadre of young women entrepreneurs in India
Non Executive Director and Group CEO at Life Healthcare Group. Dr. Shrey is a medical doctor by training and has extensive experience in the heathcare industry
Managing Director & CEO- Max Healthcare Over 20 years of experience in financial services. Previously Chief Operating Officer at Max Life Insurance.
Senior Director & Chief Financial Officer Over 20 years of experience in across all facets of finance; previously CFO of Fortis Healthcare.
Senior Director & Chief Growth Officer 18 years of diverse experience across industry and management consulting with McKinsey & Company
Senior Vice President & Chief People Officer Over 17 years of experience in HR across FMCG, Financial Services and Health Care sectors. Previously global head of HR at Glenmark Pharmaceuticals
Director & Zonal Head – NCR 1 Over 23 years of experience in Business Management and Sales & Marketing; previously with Amex
Director - Sales & Marketing More than 17 years of experience in diverse fields such as advertising, retail , healthcare and media. Previously Head, Sales and Marketing at Fortis Healthcare
Director - Clinical Directorate & Institute of Internal Med. Over 23 years of experience in the field of Internal Medicine
Director - Service Excellence & Customer Operations More than 19 years of in-depth experience across the Financial Services sector; previously with Max Life Insurance
Director- IT & Chief Information Officer Over 21 years of experience in varied industries such as Health/ Life Insurance, IT/ITES, and Consulting; previously CIO of Prudential Life Assurance
MHC – Management Team
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Director- Legal, Compliance and Regulatory Affairs Over 26 years of diverse experience in Manufacturing, Investment Banking, PE & Infrastructure. Previously General Counsel of Deutsche Bank AG, Group General Counsel of IDFC
Key Physicians
Chairman – Cancer Care, Director & Chief Consultant - Surgical Oncology Over 25 years of experience in Surgical Oncology.
Director - Clinical Directorate & Institute of Internal Med. Over 23 years of experience in the field of Internal Medicine
Strong consultant bench strength of 350+ across specialities :
Director- Paediatrics & Paediatrics Surgery Over 20 years of experience in Paediatric surgery - complex congenital malformations
Director – Max Institute of Neurosciences, Dehradun Renowned Neurosurgeon having 40 years experience Recipient of the BC Roy award
Director of Max Institute of Minimal Access, Metabolic and Bariatric Surgery. More than 35 yrs of experience in Lap Surgery, completed 70K+ major Lap procedures
Chairman - Cardiology, Max Healthcare Clinical experience of more than 39 years Former Head, Department of Cardiology, AIIMS
Chairman – Urology,Renal Transplant, Robotics(Max Saket Complex) and Uro-Oncology Max Saket 2200 Kidney Transplantations in the last 25 years and over 1500 lap donors nephrectomy
Chairman - Liver Transplant & Biliary Sciences 2,200+ liver transplant surgeries & over 30 year experience in Liver Transplants Recipient of the BC Roy award
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MHC Network* – Performance Dashboard (Q2 & H1FY19)
*The above results are for MHC Network of hospitals and includes results for Max Super Specialty Hospital, Saket, unit of Devki Devi Foundation, Max Super Speciality Hospital, Patparganj, unit of Balaji Medical and Diagnostic Research Centre ; Saket City Hospital unit of Gujarmal Modi Hospital & Research Centre & Max Multi Speciality Hospital Greater Noida unit of Four Season Foundation ^ on the basis of net revenue
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Rs Cr
Sep‐18 Jun‐18 Sep‐17 Q‐o‐Q Y‐o‐Y Sep‐18 Sep‐17 Y‐o‐Y
a) Financial Performance Revenue (Gross) 727 694 712 5% 2% 1,420 1,414 0% Revenue (Net) 670 641 676 4% ‐1% 1,311 1,342 ‐2% Direct Costs Material Cost 163 167 169 ‐2% ‐3% 330 336 ‐2% Clincian Payout 109 112 116 ‐3% ‐7% 221 234 ‐6% Contribution 398 362 390 10% 2% 760 773 ‐2% Contribution Margin^ 59.4% 56.5% 57.8% 297 bps 163 bps 58.0% 57.6% 41 bps Indirect Costs Personnel Cost 184 185 170 ‐1% 8% 368 337 9% Other Indirect overheads 118 114 117 3% 1% 232 232 0% HO Costs 32 34 34 ‐5% ‐5% 66 70 ‐6% EBITDA 65 30 69 118% ‐6% 95 133 ‐29% EBITDA Margin^ 9.7% 4.6% 10.3% 506 bps (54) bps 7.2% 9.9% (269) bps Finance Cost 33 28 32 18% 3% 61 64 ‐5% Cash Profit 32 2 37 > 100% ‐14% 34 69 ‐51% Depreciation 38 38 34 0% 10% 76 67 12% Profit /(loss) before tax (6) (36) 3 84% < ‐100% (41) 2 < ‐100% Tax 1 1 1 ‐6% 103% 3 2 10% Profit /(loss) after tax (7) (37) 2 82% < ‐100% (44) (0) < ‐100% b) Financial Position Net Worth 1,033 1,039 1,124 ‐1% ‐8% 1,033 1,124 ‐8% Net Debt 1,237 1,222 1,168 1% 6% 1,237 1,168 6% Fixed Assets ‐ Gross Block 2,187 2,188 2,056 0% 6% 2,187 2,056 6%
Key Business Drivers Quarter Ended Growth (%) Half Year Ended Growth
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MHC Network* – Performance Dashboard (Q2 & H1FY19)
*The above results are for MHC Network of hospitals, includes results for Max Super Specialty Hospital, Saket, unit of Devki Devi Foundation, Max Super Speciality Hospital, Patparganj, unit of Balaji Medical and Diagnostic Research Centre; Saket City Hospital unit of Gujarmal Modi Hospital & Research Centre and Max Multi Speciality Hospital Greater Noida unit of Four Season Foundation
Sep‐18 Jun‐18 Sep‐17 Q‐o‐Q Y‐o‐Y Sep‐18 Sep‐17
a) Patient Transactions (Nos. in lacs) Inpatient Procedures 0.49 0.47 0.53 3% ‐9% 0.96 1.05 ‐9% Day care Procedures 0.11 0.11 0.13 1% ‐14% 0.23 0.26 ‐14% Outpatient Registrations 17.74 17.20 17.99 3% ‐1% 34.94 35.24 ‐1% Total 18.34 17.78 18.66 3% ‐2% 36.12 36.56 ‐1% b) Average Inpatient Operational Beds 2,377 2,376 2,369 0% 0% 2,377 2,362 1% c) Average Inpatient Occupancy 74.2% 70.9% 74.3% 333 bps (4) bps 72.6% 73.6% (101) bps d) Average Length of Stay (days) 3.34 3.25 3.03 ‐3% ‐10% 3.29 3.02 ‐9% e) Average Revenue/Occupied Bed Day (Rs) 43,398 44,045 43,959 ‐1% ‐1% 43,712 44,441 ‐2% f) Other Operational Data Physicians 3,023 2,968 2,854 2% 6% 3,023 2,854 6% Employees 9,597 9,388 9,202 2% 4% 9,597 9,202 4% Customer Base (in lacs) 43.9 42.3 39.1 4% 12% 43.9 39.1 12%
Key Business Drivers Quarter Ended Growth (%) Half Year Ended Y‐o‐Y Growth
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*Saket Complex includes Saket West Block, Saket East Block (unit of Devki Devi Foundation) & Max Smart (unit of Smart Hospital & Research Centre) hospital ^East Delhi Complex includes Max Patparganj (unit of Balaji Medical and Diagnostic Research Centre) & Max Vaishali hospital
MHC Network Hospitals (Saket* & East Delhi^ Complex) – Performance Dashboard (Q2 & H1FY19)
Rs Cr
Sep‐18 Jun‐18 Sep‐17 Q‐o‐Q Y‐o‐Y Sep‐18 Sep‐17
Saket Complex a) Financial Performance Revenue(Net)
250 242 257 3% ‐3% 492 512 ‐4% EBITDA
29 20 30 40% ‐4% 49 62 ‐21% EBITDA Margin % 11.5% 8.4% 11.6% 302 bps (10) bps 10.0% 12.1% (216) bps b) Average Inpatient Operational Beds No. 769 769 721 0% 7% 769 728 6% c) Average Inpatient Occupancy % 75.1% 71.8% 78.1% (331) bps (300) bps 73.5% 76.8% (333) bps d) Average Revenue/Occupied Bed Day Rs. 51,705 52,297 52,139 ‐1% ‐1% 51,993 52,511 ‐1% e) Average Length of Stay (days) 3.69 3.61 3.25 ‐2% ‐14% 3.65 3.23 ‐13% East Delhi Complex a) Financial Performance Revenue(Net) 182 166 173 10% 5% 348 336 3% EBITDA
27 12 21 121% 28% 39 41 ‐6% EBITDA Margin % 14.7% 7.3% 12.0% 740 bps 264 bps 11.2% 12.2% (107) bps b) Average Inpatient Operational Beds No. 709 691 694 3% 2% 700 685 2% c) Average Inpatient Occupancy % 81.3% 77.6% 78.8% 373 bps 251 bps 79.5% 78.0% 150 bps d) Avg. Revenue/Occupied Bed Day Rs. 38,076 37,841 36,752 1% 4% 37,963 37,160 2% e) Average Length of Stay (days) 3.46 3.24 3.04 ‐7% ‐14% 3.35 3.03 ‐11%
Half Year Ended Y‐o‐Y Growth Key Business Drivers Unit Quarter Ended Growth (%)
MBHI ‐ Board of Directors
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K Narasimha Murthy Director
Cost & Management Accountancy in
development of Cost & MIS for more than 150 companies
John Howard Lorimer Director
John joined Bupa's Board as a Non- Executive Director in July 2011. He is Chairman of Bupa’s Audit Committee and a member of Bupa's Risk Committee and UK Regulated Entities Board
Marielle Theron Director
Street Corporation, Switzerland, a company that specialises in strategic investment and management consulting solutions
Pradeep Pant Director
Pradeep is a highly experienced senior business leader, now involved in business consulting and education
Ashish Mehrotra MD & CEO
Ashish has over two decades of extensive banking experience. In his last role as MD and Head for Retail division
enabling bank gain a leadership position in the wealth management business
Rajesh Sud Chairman & Director
Rajesh Sud is the CEO and Managing Director of Max Life Insurance, one of the first three private life insurers to start operations in 2001
Rahul Khosla Co-Vice Chairman & Director
Rahul Khosla is the President of Max Group and Executive President, Max Financial Services. He is a seasoned business leader with 30 years of experience in India & globally
Joy Linton Director
Joy is the CFO of Bupa Plc. She has
and strategic roles in Australia and the UK.
Mohit Talwar Director
Mohit is the Managing Director of Max Financial Services and Max India. He has an experience of over 30 years in Corporate Finance and Investment Banking.
Director
surgeon who introduced several firsts in the field of ophthalmology to India
David Fletcher Co-Vice Chairman & Director
David commenced in the new role of Chief Risk Officer in January 2017. He has been with Bupa since 2014 in senior roles including Chief Internal Auditor and MD of IDM.
D.K. Mittal Independent Director
Administrative Service (IAS) officer of 1977 batch (UP cadre) and has served the government of India in various capacities.
MBHI – Management Team
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Vikas Gujral
Chief Operating Officer With over 18 years of experience, Vikas joins us from Max Life
worked with Bharti Airtel and GE Capital.
Rahul Ahuja
Chief Financial Officer Rahul has wide domain expertise built
banking, financial services and telecom.
Anurag Gupta
Head – Agency Anurag joins Max Bupa from Max Life, where he has held a number of senior roles across distribution and product management over a decade. Aseem has nearly two decades of experience in sales and distribution and has worked across channels - Agency, Banca, Special markets & Direct Sales.
Aseem Gupta
Head – Portfolio Management & Affinity Channels
Anika Agarwal
Head – Marketing & Direct Sales Anika heads the Marketing & E- commerce verticals at Max Bupa and is responsible for brand planning, digital media, communications, consumer insights, direct sales and E- commerce.
Atul Bhandari
Head – Banca and Alliances Atul has 15 years of experience in product/process management & sales/distribution, he joined us from CITIBANK NA, prior to which he worked in Standard Charted bank.
Partha Banerjee
Head – Legal & Compliance Partha brings along 20 years of diverse experience in Corporate, Commercial, Taxation, IPR, Exchange Control, M&A, Labour Laws and other substantive and procedural laws.
Ashish Mehrotra
MD & CEO Ashish has over two decades of extensive banking experience. In his last role as MD and Head for Retail division
enabling bank gain a leadership position in the wealth management business
Tarun Katyal
Chief Human Resources Officer Tarun has joined us from for Sistema Shyam Teleservices. He has over 25 years of experience across retail & manufacturing industries, including multi-national and Indian corporates
Ramanan A V
Actuarial head Raman has joined us from Cholamandalam MS General Insurance where he was heading the Actuarial department, he started his carrer as a lecturer and has also worked with Tamil Nadu Electricity Board for 20 years
Max Bupa – Performance Dashboard (Q2 & H1FY19)
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Sep‐18 Sep‐17 Sep‐18 Sep‐17
a) Gross written premium income First year premium 83 54 54% 142 108 32% Renewal premium 136 115 18% 262 219 19% Total 219 168 30% 404 327 24% b) Net Earned Premium 182 146 25% 345 279 24% c) Cash Profit /(Loss) (22) (2) < ‐100% (30) 3 < ‐100% d) Pre tax Profit /(Loss) (26) (6) < ‐100% (39) (5) < ‐100% e) Claim Ratio (B2C Segment, normalized)* 55% 60% 500 bps 53% 58% 530 bps f) Avg. premium realization per life (B2C) 8,293 8,057 3% 8,399 7,952 6% g) Conservation ratio (B2C Segment) 85% 82% 302 bps 85% 83% 193 bps h) Lives In force in millions (including RSBY) 3.1 2.5 24% i) Number of agents 26,505 21,915 21% j) Paid up Capital 941 926 2%
Key Business Drivers Quarter Ended
Y‐o‐Y Growth
Half Year Ended
Y‐o‐Y Growth
MAX INDIA LTD.
Max House, Okhla, New Delhi – 110 020 Phone: +91 11 26933601‐10 Fax: +91 11 26933619 Website: www.maxindia.com
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