Practo aims to strengthen its presence in smaller cities and towns and leverage AI to analyze data and deliver much better healthcare analytics and outcomes.
Tencent-backed healthcare and diagnostics app Practo is aiming to turn profitable in the next financial year and is considering listing through an initial public offering (IPO) soon, its co-founder and CEO Shashank ND said.
Practo aims to strengthen its presence in smaller cities and towns and leverage AI to analyze data and deliver much better healthcare analytics and outcomes.
In an interview with PTI, Shashank said that the startup is already cash flow positive. “This year we will grow significantly… Our EBITDA would have improved dramatically compared to last year. We will be close to breaking even this year and next year we will actually be able to show significant profits.” Founded in 2008, Practo connects doctors with patients and offers various additional services such as telemedicine.
Income from diagnostic and consulting services accounted for 50 percent of the total performance. In the financial year 2022-23 (April 2022 to March 2023), the Bengaluru-headquartered company halved its losses to Rs 93.68 crore. Revenue rose 3 percent year-on-year to Rs 194.53 crore and earnings before interest, taxes, depreciation and amortization (EBITDA) improved 39 percent.
Revenue from diagnostic and consulting services accounted for 50 percent of total operating revenue, with the remainder coming from subscription services, software sales and maintenance for doctors and clinics. He said the company is targeting full-year profitability in the next financial year as it aims for sustainable growth while delivering exceptional service through a full-stack model.
Backed by China's Tencent and venture capital funds Peak “I think this is something we've mastered and now it's up to us to continue to grow rapidly,” he said.
There is also a listing on the radar. “Yes, we would like to go public. I can’t give any timelines but yes, soon,” he added. “I expect the company to go public soon, but I don't think there is a specific timeline for that. We’ll have to wait and see in two or three years.”
He called the domestic market a priority for the company and explained that Practo will “penetrate deeper into different regions” in the next few years.
The company connects around 15 million people with doctors in India annually, with more than 50 percent of the business coming from 6-7 top cities.
Having established itself in major cities, the focus is now on expanding operations in tier and tier-3 cities and towns, Shashank explained.
“We made a lot of good progress and were number one with a very large market share. Now we believe the next phase is to create an omnichannel approach where online and offline virtually work hand in hand,” he noted.
The advent of AI has really opened up new opportunities in healthcare to analyze a lot of data and provide much better analytics, he said.
“Even a 2 percent improvement in quality means lives are saved in healthcare. So those are a few areas that, as you know, broadly speaking, we're really focused on moving forward,” Shashank told ND. He noted that the company is well capitalized and there are no immediate plans to raise funds.
Practo, which has raised around $230 million in multiple funding rounds to date, is present in over 30 million countries and helps over 30 million patients by connecting them with around 1.5 million verified partner doctors. Shashank said the company wants to focus on strengthening its existing businesses while staying away from other verticals such as diagnostics.
“If you look at the private provider (segment), the volume in India is about $100 billion. It's a very, very large area. Undoubtedly, diagnostics and others have very good margins. But I think the supply side itself is very large.” “I think we're very comfortable staying on the supply side,” he noted.
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