W-Power

We are not focused solely on building large hospitals—we are building intelligent systems: Suneeta Reddy

The managing director of Apollo Hospitals talks about the digital shift in healthcare, expansion plans, bridging the urban-rural healthcare divide and more

Naini Thaker
Published: May 31, 2025 05:49:09 PM IST
Updated: May 31, 2025 06:14:50 PM IST

Suneeta Reddy, managing director, Apollo Hospitals; Image: Balaji Gangadharan for Forbes IndiaSuneeta Reddy, managing director, Apollo Hospitals; Image: Balaji Gangadharan for Forbes India

Apollo Hospitals Enterprise Ltd (AHEL) reported a strong close to FY25, with consolidated revenues rising 14 percent year-on-year to ₹21,794 crore and net profit surging 61 percent to ₹1,446 crore, the company announced on Friday.

Apollo Hospitals Enterprise, which is present in three major verticals—Hospitals, Diagnostics and Pharmacy—also crossed the ₹10,000 crore milestone in its core Healthcare Services segment. Backed by robust growth across verticals and a 54 percent jump in Q4 profits, Apollo also announced a significant expansion strategy, including over ₹8,000 crore in capital outlay to add 4,300+ beds over the next three to four years. The Bengaluru and Hyderabad markets will see major capacity additions, with new hospitals planned in Sarjapur and Jubilee Hills, respectively, Apollo Hospitals said in a press release.

In a conversation a few days before the results, Suneeta Reddy, managing director, Apollo Hospitals, spoke about funding, expansion plans, bridging the urban-rural healthcare divide, cross-border healthcare collaborations and more. Edited excerpts:

Q. Apollo has long spoken about bridging the urban-rural healthcare divide. How has that vision translated on the ground?

Apollo is perhaps the only private healthcare provider with a meaningful footprint across India’s Tier 1, 2, and 3 cities—nearly 30 percent of our bed capacity lies in Tier 2 and 3 geographies. We’ve developed a calibrated, cost-effective model that allows us to deliver high-quality clinical outcomes in emerging cities without the capital intensity of metro setups.

Read More

We also operate Apollo Telemedicine, collaborating with state governments to ensure that smaller towns—which lack proper hospitals—receive quality healthcare through their public health centres. Patients who would otherwise have to travel to larger cities for their health problems come to the centre where they can consult with doctors at the centre as well as with specialists remotely. Our Apollo Telemedicine Networking Foundation (ATNF) has delivered over 20 million teleconsultations, extending specialist care to remote geographies and public health centres, often in partnership with state governments.

An example of our commitment to rural health is the Aragonda model—a flagship initiative under Apollo’s ‘Total Health’ programme in the village of Aragonda, Andhra Pradesh. This programme provides a continuum of care from maternal and child health to non-communicable disease management, nutrition, and health education.

In fact, the Harvard T H Chan School of Public Health published a case study on this model, emphasising its integrated approach to healthcare delivery, education, livelihood generation, and long-term sustainability. It is one of the few documented Indian rural health interventions with a full-spectrum, data-driven methodology.

Q. As a for-profit healthcare provider, how does Apollo Hospitals navigate the balance between financial sustainability and providing accessible, affordable care to all segments of society?

We take an integrated scalable approach to care delivery while keeping a focus on operational efficiency and technological innovation. We have achieved an ROCE of 29 percent in Q3FY25 for our healthcare services due to our high-quality clinical delivery and state‐of‐the‐art infrastructure. Our operational efficiency is reflected in the reduced average length of stay (from 4.0 to 3.3 days over a period of 7-8 years) and higher revenue per occupied bed with both enhanced patient outcomes and robust financial performance.

Going beyond the traditional brick-and-mortar locations with a digital-first approach has allowed us to expand access, particularly to under-served or remote populations. Our digital platform Apollo 24/7 has democratised access to high-quality healthcare. We are also leveraging technology to improve care continuity, reduce overheads, and ultimately support profitability. We also support care initiatives like Apollo SHINE and Total Health and contribute to community health.

Q. Advent International invested approximately $297 million in Apollo Hospitals last year. What were the key objectives behind this private equity infusion, and how does it align with Apollo’s long-term plans?

Advent International’s investment was a strategic inflection point in our journey to marry clinical excellence with cutting-edge technology and digital capability. In an era where digital penetration in the country is over 70 percent in some states and 95.15 percent of villages have access to the internet, the investment will help accelerate the expansion of our omni-channel digital platform, Apollo 24x7. The platform now facilitates over one million teleconsultations annually and integrates a wide array of services, from on-demand diagnostics and pharmacy services to hospital concierge and digital insurance broking, all powered by advances in data analytics and AI to ensure a seamless and stress-free patient journey to good health. Apollo HealthCo, which has become EBITDA-positive, is projected to grow at over 20 percent year-on-year, reinforcing our leadership in a healthcare ecosystem that is undergoing rapid transformation.

Q. What measurable impact has this investment had on operational efficiencies and the quality of patient care?

I would like to share a historical example. We were the first to get FDI into India through Schroders, which validated the corporate healthcare model. Later, our second investment from Temasek provided learnings from Singapore’s government hospitals and processes. Our third investment, from Apax, executed at a 10 percent premium to market, financed a 30 percent capacity expansion. These investments not only validated our model but also sharpened our hospital and pharmacy offerings and improved process efficiencies based on cost, marketing, and operational insights—all while ensuring a healthy return for our investors.

Q. To what extent is Apollo working with the public sector? Are there public-private partnerships (PPP) or tie-ups with government hospitals?

Yes, we believe public-private partnerships are essential to scale health access in India. In Bilaspur and Rourkela, we’ve partnered with large public sector enterprises; and in Delhi IMCL, we operate a joint venture with the Delhi government.

Beyond that, we work closely with state governments on telemedicine—running government-linked health facilities in Jharkhand, Andhra Pradesh, and Uttar Pradesh. We work closely with state governments in identifying areas where there is a need, and partner with them on land allocation and investment as well.

Q. How are cross-border healthcare collaborations being leveraged to enhance patient care across international boundaries?

When Apollo was founded in 1983, nearly 80 percent of Indian patients travelled abroad for advanced treatments—particularly for cardiac and orthopaedic care. Our mission was to reverse that trend by building world-class infrastructure, clinical expertise, and patient trust right here in India. And we succeeded. Today, Apollo is a preferred destination for patients from over 140 countries.

As healthcare costs rise globally, we identified under-served markets across the Middle East, Africa, Southeast Asia, and South Asia. We’ve expanded using a flexible model—setting up and managing hospitals in Bangladesh, investing in facilities in Sri Lanka (from which we achieved a successful exit), and deploying telemedicine solutions where full infrastructure wasn’t feasible.

One recent milestone is our partnership with Mayapada in Indonesia, where we are training local doctors and integrating their ICU services with Apollo’s expertise. We have also established a permanent presence in the country to deepen our engagement. In the Middle East, our collaboration with RAK Hospital in the UAE is bringing Indian clinical excellence to a wider audience.

Q. What are some of the unique challenges involved in managing large-scale, multi-specialty healthcare institutions in today’s evolving healthcare landscape?

Scale brings both opportunity and responsibility. The first and foremost challenge is ensuring clinical outcomes at scale. In a network as expansive as ours—71 hospitals, over 10,000 beds, and thousands of clinicians—we have zero room for error. That’s why we built the Apollo Clinical Excellence (ACE) programme, which audits 500+ quality indicators regularly, covering everything from infection control to surgical outcomes and patient satisfaction.

The second major challenge is talent development. Healthcare is deeply human, and we invest consistently in training nurses, paramedics, and medical staff through our 12 nursing schools and two medical colleges. We aim to build future-ready skilled professionals who can adapt to both high-tech and high-touch care.

The third challenge is policy-related—particularly GST. Healthcare services are exempt, but we don’t receive input credit for goods and services used, which raises operational costs. We continue to discuss with the regulators for a more sustainable cost structure.

Lastly, insurance dynamics have shifted significantly post-Covid. Our payor mix has moved from 25 percent to 43 percent share of insurance, indicating a welcome shift in public awareness about health insurance. However, delayed reimbursements and claim management complexities still pose operational hurdles. Addressing this will be key to unlocking further efficiencies in private healthcare.

At Apollo, our approach is to turn these challenges into opportunities for continuous improvement—because when systems perform at scale, outcomes are amplified for millions.

Q. There’s growing concern about workforce strain in healthcare, particularly among doctors and nurses. Is the core issue a shortage in talent production, or are we facing challenges in effectively deploying and retaining the existing workforce?

It is a combination of both. India faces a significant demand-supply gap in clinical talent, particularly in nursing and specialised care. The WHO recommends a doctor-patient ratio of 1:1000—and while we are improving, there’s still a shortfall in rural and even urban public systems.

At Apollo, we have mitigated this through sustained investment in our own talent pipeline, with nursing schools and medical colleges that help us ensure a steady flow of well-trained professionals. But talent production alone isn’t enough. The real challenge lies in workforce deployment amid rapid digital transformation. We have committed to preserving and strengthening patient-facing roles, not reducing them. At the same time, we are leveraging AI and intelligent staffing systems to optimise back-end operations, improve shift allocations, and reduce burnout—so clinical teams can focus on patient care.

We believe that over the next two to three years, these systems will yield measurable improvements in productivity, retention, and clinician well-being.

Q. With tech giants entering healthcare, what challenges and opportunities does Apollo see with the digital disruption, and how can these players further healthcare innovation?

The digital shift in healthcare is both inevitable and welcome. Patients today are digitally empowered, and healthcare delivery must meet that expectation. At Apollo, we have actively partnered with Microsoft and Google to integrate their AI and data tools into our clinical systems.

One such example is the Apollo-Microsoft Cardiac Risk Score, which predicts and helps reverse the risk of heart disease using AI. These collaborations enable us to improve diagnostics, personalise care, and support our clinicians with real-time decision intelligence—making technology an ally, not a threat. We believe innovation happens best when tech and clinical expertise come together.

Q. What’s your long-term vision for Apollo Hospitals, and what key challenges do you foresee?

My vision is for Apollo to continue growing as a learning, intelligent, and compassionate organisation. We are not focused solely on building large hospitals—we are building intelligent systems that integrate care across physical and digital platforms. The goal is quality care that is accessible, affordable, and outcome-led.

We will continue to invest in preventive care, digital transformation, and people-first systems. Challenges will always exist—talent shortages, regulatory frameworks, rising costs—but we see them as opportunities for transformation. I come to work inspired by a purpose: To build a healthcare system that earns and keeps the patient’s trust.

X