Chairman's Letter

Dear Shareholders,

I begin this letter with a deep sense of gratitude and pride. Gratitude for your support and commitment to your Company, and pride because of the determination with which your Company faced a spate of challenges through the year.

Max Healthcare was created with an aspiration to build India’s leading provider of comprehensive, seamless and integrated world-class healthcare services. Over the years, with a consistently high level of service excellence across 14 world-class facilities and more than 2,300 leading doctors with international level expertise providing highest standards of medical excellence at a fraction of international costs, MHC is now a provider of choice for millions of patients across India and abroad.

Max Healthcare continues to set new benchmarks in clinical quality and service excellence, with an array of awards and accolades to acknowledge its efforts. Some of these awards included:

  • Bronze Award at the World Conference for Quality and Improvement 2018, organised by the American Society for Quality (ASQ) – the first healthcare organisation to win an award at this prestigious forum in the last decade

  • Winners in Association of Healthcare Providers of India (AHPI) Awards – Quality Beyond Accreditation for Blood Bank and Infection Control (Max Vaishali)

  • Quality Council of India (QCI) DL Shah Platinum Quality Award for reduction in Ventilator Associated Pneumonia in ICUs (Max Smart)

  • Times Healthcare Achievers Award – Legend of the Year – Cardiac Surgery (Max Smart)

  • International accolade for Venous Thromboembolism (VTE) Risk Assessment at IHF Taipei 41st World Hospital Congress

Being providers of high quality but complex medical procedures, our key touch points with our customers are most likely to be in moments of deep vulnerability, strong emotions and anguish. This situation gets exacerbated with misinformed, poorly researched opinions, lack of authentic data and inflammatory reportage from media organisations.

There is an urgent need to shift the focus from baseless criticism of private hospitals on aspects such as overcharging and medical negligence to more critical issues such as the key role of private providers in the delivery of healthcare in India, the dismal state of public infrastructure, the lack of public investment in improving capacity and service delivery, and regulatory interventions that create barriers to proper growth and development of the healthcare sector.

Max Healthcare won the Bronze Award at the World Conference for Quality and Improvement 2018, organised by the American Society for Quality (ASQ) – the first healthcare organisation to win an award at this prestigious forum in the last decade


The Indian healthcare industry is expected to reach around US$ 400 billion in sales by FY 2025 and significantly contribute to the development of the Indian economy as well as be amongst the top employers in the country. The private sector has and will continue to play a primary role in delivering this growth.

We should acknowledge that the private healthcare sector and its doctors have been consistently recognised for providing world-class medical services, adapting latest advancements and technology at extremely low costs compared to many developed or developing nations. For instance, a knee replacement surgery would cost US$40,000 in the US, US$10,000 in Thailand and US$13,000 in Singapore, while the same surgery would cost US$8500 in India. A heart valve replacement surgery would cost US$2,00,000 in the US and US$90,000 in Britain while the same procedure in India would cost only US$8,000. This cost arbitrage, along with high quality expertise has made India a major medical value travel destination in recent years.

For successful and smooth evolution of the healthcare landscape in India, we need enabling regulations to help multiple business models thrive – single specialities, primary centres, quaternary hospitals, home care, tele-medicine, aggregators and many other formats that we may not even know of today.

70% of bed additions in Urban India from FY 2004-14 have been contributed by the private sector. Moreover, contrary to the common perception, the private sector has contributed significantly in delivery of healthcare services in rural India as well – 55-60% of hospitalised cases in rural India are treated by the private sector

Private providers are also expected to be the predominant contributors to the $40-45 billion investment required to reach 1.8-2.0 bed /1,000 patients by FY 2025. While there is a broad-based realisation that private providers and the Government need to collaborate effectively to tap into the full potential of the sector and move towards achieving affordable and quality healthcare for all, the progress in this direction has been gradual.

The National Health Protection Scheme (NHPS), popularly known as Ayushman Bharat is a big step forward and holds the potential to be a game changer for Indian healthcare. NHPS can transform the Indian healthcare sector, provided the Government and private sector collaborates constructively to leverage respective expertise in addressing execution challenges, develop a common understanding of healthcare economics, create innovative PPP models and decrease cost of doing business to economically serve a wider population base.

Allow me to touch upon a few imperatives to make this initiative a real success. We have been in constant dialogue with the various government agencies, including the Ministry of Health and Family Welfare and NITI Aayog, sharing some key inputs on this matter.

  1. Expedite actions to address mismatch of demand and supply

  2. Address talent shortage through creative solutions

  3. Implement a strong gate keeping and referral system to ensure patient safety and cost control

  4. Develop a robust IT infrastructure for efficient administration

  5. Adopt a fact-based approach to fix rates for strategic purchase of healthcare services from the private sector

  6. Adequate financing for claims settlement under Government schemes

  7. Set-up a quality regulator


The Indian healthcare sector is going through very exciting times. The Ayushman Bharat Initiative will give a significant fillip to the demand for quality healthcare services and, with shortage in supply, the growth prospects for private providers will only get stronger. At the same time, business models will need to evolve and adapt to new realities.

For successful and smooth evolution of the healthcare landscape in India, we need enabling regulations to help multiple business models thrive – single specialities, primary centres, quaternary hospitals, home care, telemedicine, aggregators and many other formats that we may not even know of today.

Healthcare is a long gestation investment and will need a lot of capital to create scale and reach. Adverse economic actions such as price capping, in the absence of a holistic understanding of cost incurred in delivering high quality healthcare services will surely risk the national goal of universal healthcare as this will dissuade conscientious players from investing in the healthcare business. This will lead to unorganised capital and “less conscientious” players flourishing, thus rendering serious risk to patient safety, quality of care and ultimately the cost of care and morbidity.

Healthcare is a national imperative. As India navigates through its journey of achieving economic development, it must invest in an efficient and universal healthcare system to drive progress. I remain hopeful that the public and private sector will work more seamlessly to deliver this national goal.

Let me also briefly touch upon our other key businesses.

Max Bupa Health Insurance continues to deliver on consumer experience, which is reflected in the fact that nearly 80% customers express the highest levels of satisfaction with their claims experience with Max Bupa. This is significantly higher than the global insurance industry benchmark of 75% and reflects the care taken by the company in honouring its promise to customers in their “moment of truth”. In a large, fast growing market, Max Bupa has created a vast distribution network, serves 2.8 million customers and has established itself as a leading brand. The business is on a strong top line growth trajectory, with Business to Customer (B2C) segments’ gross written premium growing 26% in FY 2018. With bancassurance tie-ups with banks such as Bank of Baroda, HDFC Bank and South Indian Bank, the company has registered a healthy 37% growth in bancassurance sales over the past two years.

The business has also made significant strides in developing its Digital channel which has been a focus area for the past 2-3 years. During this period, the channel has grown 22%. In addition, the spirit of innovation is alive in the Company, reflected via the launch of Go Active that offers a unique proposition by taking a comprehensive view of the customer’s health and fitness and creating the right partnerships that benefit the customer across the health and fitness spectrum.

Going forward, Max Bupa will continue to grow the business exponentially, including bancassurance, an improved agency model and digital sales, while keeping relentless focus on execution and structural cost efficiencies.

I am proud to say that Antara Senior Living commissioned its first senior living community in April last year and is currently catering to the daily requirements of the residents who have relocated to that community. Antara is a unique and category-defining concept with a singular vision of delivering a world-class, fully serviced residential community for those who believe that age is just a number. With its second offering expected to be launched in FY 2019, I have no doubt that Antara will earn a well deserved reputation for being the quintessential brand that defines the highest quality of senior living services in India.

Our youngest business – Max SkillFirst has grown significantly in a very short period of time. In FY 2018, Max SkillFirst launched its first direct to consumer training facility - Centre for Allied Healthcare Programmes at Vaishali, Ghaziabad. The Centre will offer Diploma Courses in four disciplines of Allied Healthcare to equip students with necessary skills, knowledge and competencies to enable them to perform a wide range of medical care procedures and tap into successful livelihood options. In addition, the business continues to cater to the training requirements of Max Group’s other businesses including Max Life, Max Healthcare and Max Bupa.

All our businesses are deeply committed to delivering long-term growth with a sound combination of strong financial performance, caring and service excellence. I am optimistic that Max India and its vibrant businesses will continue to thrive despite all challenges in the coming years. I hope you will accompany us through this journey to growth.

With Best Wishes,

Rahul Khosla

Chairman, Max India Limited