-HOSPITALS - June 7,2021 The List~ngDepartment Corporate Service Department National Stock Exchange of India Ltd BSE Limited Mumbai 400 051. Mumbai 400 001. Scrip Code : SHALBY Scrip Code: 540797 Through : https://www.connect2nse.corn/LISTING/ Through : htt~://list~nn.bse~nd~a.corn Sub: lnvestor Presentation - Disclosure under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015 ("the SEBI LODR") Dear Sir / Madam, Pursuant to Regulation 30 of the SEBI (Listing Obligation and Disclosure Requirements) Regulation 2015, we are enclosing herewith updated lnvestor Presentation of the Company. The said presentation is also being made availa'ble at the website of the Company at www.shalbv.org. Thanking you, Yours sincerely For Shalby Limited Tushar Shah AVP &Company Secretary Mem. No: FCS-7216 Encl.: as above Shalby Limited Regd. Off. : Opp. Karnavati Club, 5 G Road, Ahmedabad -380015 (India) Tel. No. : (079) 40203000 1 Fax : (079) 40203109 1 www.shalbv.org I [email protected] Regd. No. :061000596 I ClN : L85110G12004PLC044667 Vapi - lndore - labalpur - Mohali - Naroda (Ahmedabad) Krishna Shalby (Ahmedabad) Surat - laipur I Investor Presentation June 2021 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. AGENDA 01 BUSINESS OVERVIEW 02 FINANCIAL PERFORMANCE 03 STRATEGIC DIRECTION 04 SHALBY IMPLANT BUSINESS 05 APPENDIX 2 BUSINESS OVERVIEW OUR REGIONAL PRESENCE Shalby has developed strong brand recognition in its core markets and is well positioned for further expansion ➢ 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 Existing 11 Units (2112 beds) ▪ Surat – 243 beds Upcoming 2 Units (321 beds) Existing 11 Units (2012 beds) Upcoming 2 Units (288 beds) 50 Outpatient Clinics across 15 states in India MADHYA PRADESH ▪ Indore – 243 beds ▪ Jabalpur – 233 beds MAHARASHTRA Upcoming Two Units ▪ Mumbai (Santacruz) – 175 beds MAHARASHTRA ▪ Nashik – 146 beds ▪ Ghatkoper (Zynova) – 150 beds 4 ANNUAL PERFORMANCE TRENDS Significant impact of Covid-19 on the key operational parameters in FY21 In Patients Day Care Out Patients 23,728 3,25,596 2,96,197 39,030 19,674 19,668 36,311 2,61,562 28,847 FY 19 FY 20 FY 21 FY 19 FY 20 FY 21 FY 19 FY 20 FY 21 ARPOB (In Rs.) Surgery Count 31,296 30,457 27,400 19,908 19,840 11,933 FY 19 FY 20 FY 21 FY 19 FY 20 FY 21 5 ANNUAL PERFORMANCE TRENDS Arthroplasty contribution to total revenue and bed occupancy levels declined due to Covid-19 pandemic especially during first half of the year Hospital Revenue Mix by Care % of Revenue from Arthroplasty 45% 45% 12% 13% 12% 23% 84% 83% 85% FY 19 FY 20 FY 21 FY 19 FY 20 FY 21 In Patient Day Care Out Patient No. of Beds Occupied Occupancy Rate ALOS (Days) 37% 38% 450 36% 5.42 413 428 4.15 4.22 FY 19 FY 20 FY 21 FY 19 FY 20 FY 21 FY 19 FY 20 FY 21 Notes: 1. ALOS is without Day Care 6 HOSPITALS SPECIALTIES Revenue by Hospital Specialty 50% 45% 40% 33% 30% 23% 20% 11% 12% 10% 9% 8% 9% 10% 10% 6% 6% 4% 4% 5% 5% 0% Arthroplasty Critical Care & Orthopaedic Cardiac Science Nephrology Oncology Neurology Others General Medicine FY 20 FY 21 Number of Surgeries by Specialty Revenues by End Patient Arthroplasty 55% Orthopedic 27% 48% 16% Nephrology 38% 3% General Surgery Surgery 27% 3% 24% 3% Mix 48% 23% Cosmetic & Plastic Surgery 18% 7% 3% (Nos.) Oncology 8% 3% 7% 2% 12% Cardiac Science 3% Others Self Pay Corporate Insurance Corporate Private 12% 10% 0% Government FY 21 FY 20 FY 21 FY 20 Note: 1. All numbers are on Standalone basis 7 BUSINESS MODEL Greenfield Acquisition 907 Beds Brownfield 977 Beds 366 Beds Franchise Lower capital requirement Lower New Growth Area Franchise Naroda 2017 Year Jabalpur 2015 Year 267 Beds 233 Beds 2017 Year SG 2007 Year Mohali 201 Beds 145 Beds Leased Santa Cruz 2024 Year 2023 Year 175 Beds Nashik 146 Beds Jaipur 2017 Year Indore 2015 Year 2012 Year 237 Beds 243 Beds Krishna 220 Beds 1994 Year 2017 Year 2012 Year Freehold Vijay 27 Beds Surat 243 Beds Vapi 146 Beds Upcoming hospital developments Faster time to market Notes: 1. SG Group comprises of SG and Vijay. Surat Group comprises of Surat and Vapi 2. Fixed rent of Rs. 5L per month is paid by Shalby SG to Dr. Vikram Shah and Rs. 50,000 per month is paid by Vijay Shalby to Shalby Orthopedic and Research Centre in which Dr. Vikram Shah is a partner 8 3. Total bed count of 2112 includes 150 beds at Zynova-Shalby Hospital, Mumbai BUSINESS MODEL Our Business Model – Optimising Capex and Opex Optimize capex Operational planning with Efficiency due Inhouse to ▪ Lowest Capex and Opex per bed projects better capex due to optimal use of real-estate team planning ▪ Equipment planning and utilities planning ▪ In-house planning teams Cost per bed ~ ▪ Focus on surgeries with higher Rs. 4.5 millions EBITDA upwards ARPOB, better margins and return for fully owned of 20% which is ratios set-up. Lower for higher than leased premises industry average ▪ Centralised procurement ▪ Gradual ramp-up of bed capacity Leveraging ▪ Fully owned or O&M on revenue Better utilization Utilities planning Low economies of sharing (no fixed rentals, no security of space [and to optimize consumable scale through expensive real deposit or MG) capex cost centralized estate] procurement 9 HOSPITAL MATURITY PROFILE Shalby Hospitals generates positive EBITDAR Margin within 3 years of its operations 30% 18% 24% Avg. EBITDAR Margin Avg. EBITDAR Margin Avg. EBITDAR Margin Naroda SG Group Indore Jaipur Nashik Krishna Jabalpur Surat Group Mohali Santa Cruz 8+ Years 5+ Years 3+ Years 2+ Years Pipeline Pipeline focused on high ARPOB regions and Franchise rollout Nashik Pipeline Santa Cruz Pipeline SG Group Jaipur Naroda Mohali Krishna Jabalpur Indore Surat Group <200 Beds 200 – 230 Beds 231 – 240 Beds 241 – 260 Beds 261+ Beds Note: Greenfield Brownfield Acquisition Franchise 1. All numbers are on Standalone and FY2021 basis 10 HOSPITAL BUSINESS UPDATE Santa Cruz Development Update Nashik Development Update Business Model: Revenue Sharing Business Model: Revenue Sharing Bed Capacity: 175 Bed Capacity: 146 Operating and Management Term: 30 + 30 years Operating and Management Term: 30 years Operationalization Year: FY 2024 Operationalization Year: FY 2023 Estimated Cost: Rs. 1,600 million Estimated Cost: Rs. 310 million Approval awaited from Brihanmumbai Municipal Corporation Brownfield development with Shalby to invest in medical (BMC). Formed a wholly owned subsidiary in the name of equipments. Shell structure is ready. MEP & interior work is Shalby Hospitals Mumbai Private Limited to manage Mumbai underway hospital 11 EXPERIENCED BOARD OF DIRECTORS Dr. Vikram Shah Chairman and Managing Director Mr. Sushobhan Dasgupta Non – Executive Director Over two and a half decades of professional healthcare experience across UK, USA and India, Dr. Shah has been serving as Director of the Department of Knee With over 30 years experience in the field of healthcare, he has worked in several Replacement at Shalby Hospitals since 1993. Recognised for his outstanding developed & emerging markets across several businesses and disciplines in the medical contribution in the field of orthopaedics on completion of 1,00,000 joint technology, orthopedics and consumer health sectors. Responsible for managing the replacement surgeries, he received the ‘Times Man of the Year’ Award by Times of hospital business and leading strategic initiatives at Shalby India Group in 2018. Dr. Ashok Bhatia Mr. Shyamal Joshi Non- Executive Director Independent Director With more than 40 years of professional experience, in the past Dr. Bhatia was Associated with Shalby Hospitals since 2010, Mr. Joshi has significant experience in associated with Cadila Healthcare as President, Emerging Markets. Currently, he is various areas including corporate strategy and fund raising. he holds a Bachelor’s an external consultant of McKinsey & Co and a visiting faculty member at IIM degree in Commerce from Gujarat University and is also a member of the ICAI. Ahmedabad, IIM Rohtak and IIT Gandhinagar. Mr. Tej Malhotra Dr. Umesh Menon Independent Director Independent Director Mr. Malhotra has over four decades of experience in various industries both in Dr. Menon has experience in the areas of finance and cost accounting and is currently India and internationally. Previously he held the positions of Senior Executive also on the board of directors of Varis Management Services. He is a regular visiting Director at GHCL, Technical Director at Idea Soda Ash and Calcium Chloride faculty member at Emirates Foundation and an international expert and trainer for the Company of Saudi Arabia and Executive Engineer (Mechanical) at Hindustan United Nations Industrial Development Organisation. Copper. Ms. Sujana Shah Independent Director Ms. Shah is a practicing Chartered Accountant and has vast experience of over 18 years in the fields of finance, accounts, audit, direct and indirect taxes, banking and treasury. Presently she is a partner of V. R. Shah & Associates. She has also been the statutory and 12 internal auditor of some of the most reputed public banks of India. SENIOR MANAGEMENT Senior Management Mr. Sushobhan Dasgupta Mr. Shanay Shah Vice Chairman and Global President President With over 30 years experience in the field of healthcare, he has worked in several developed & emerging markets across several businesses and disciplines in the With over seven years of experience in the healthcare industry, Mr. Shah is involved in medical technology, orthopedics and consumer health sectors. Responsible for overseeing the international business, investor relations and digital transformation of managing the hospital business and leading strategic initiatives at Shalby Shalby Hospitals.