Beauty, Wellness Firms Plan to Cash in on Booming Biz

Goodwill Hospitals, hair & beauty salon Jawed Habib, Apollo Pharmacy to tap the capital market in a few months

A pharmacy, a beauty salon and an eyecare chain figure among five niche companies planning IPOs in the next 12 months to tap the booming consumer healthcare and wellness market. These firms include healthcare and beauty treatment provider Goodwill Hospitals, hair and beauty salon Jawed Habib, drug retail chain Apollo Pharmacy, diagnostics chain Super Religare Laboratories and eyecare firm Vasan Eyecare.  With rising disposable incomes and growing health and fitness consciousness, demand for health, wellness and grooming services in the country has gone up. The country's wellness industry is growing at 35% and estimated to touch . 14,500 crore by 2014.  This high growth is fuelling the ambitions of niche healthcare and wellness companies. Just a month ago, Birla Pacific Spa became the first Indian wellness and spa firm to be publicly listed, following the footsteps of Talwalkars Better Value Fitness, the country's first fitness centre chain that went public last year.  Both the firms are trading at a significant premium to their listing price. Birla Pacific Spa's share price on Wednesday was . 20.60, twice its listing price of . 10.10, while Talwalkars ended the day at . 191.30, a 50% premium over its listing price of . 128.  Industry experts say several midsized healthcare firms have attained critical size and need capital to undertake their next phase of expansion. "They want to have a pan-India presence or consolidate in existing regions," said Rana Mehta of consulting firm PwC.  Ashish Bansal of KPMG said niche firms provide higher return on investment compared with traditional hospital firms like Apollo Hospitals and Fortis Healthcare. ''They are less capital intensive, provide high margins and can be easily scaled up, an attraction for investors, '' he said.  Goodwill Hospitals has got permission from market regulator Sebi to raise about . 62 crore to fund expansion plans, which include a cosmetology centre in Gurgaon and a 700-bed hospital in Faridabad, while Jawed Habib is awaiting a go-ahead from the regulator to raise around . 60 crore, making it the first hair salon and beauty chain to be listed.  "We expect to list by October," said Namrata Chawla, chairperson at Ojjus Medicare, the holding company of Goodwill Hospitals. SRL plans to raise about . 550 crore and become the country's only listed diagnostics chain. It had earlier filed a draft prospectus with Sebi, but will now have to file regulatory documents once again as there has been a change in its ownership pattern after becoming a subsidiary of Fortis.  Apollo Pharmacy, too, is considering the IPO option, but will finalise plans after norms on FDI in multi-brand retail are finalised. Chennai-based Vasan Eyecare could hit the market in the next 10-12 months, said Chairman AM Arun. Apollo Hospitals, the parent company of Apollo Pharmacy, was the first healthcare company to be listed way back in 1983. But since then, only a handful of hospital chains such as Fortis have gone public as many of the top hospitals in India are owned by trusts or NGOs, which cannot be public traded.  khomba.singh@timesgroup.com