Apollo Hospitals Plans to Open 500 Indian Drugstores

Apollo Hospitals Enterprise Ltd. plans to open more than two dozen drugstores a month through May 2008 in India, where pharmaceutical sales are growing 10 percent a year.

Apollo, India's biggest health-care company, plans to invest 1.18 billion rupees ($26 million) expanding its chain of pharmacies to 850 from 350 over the next 18 months, K. Padmanabhan, the Chennai-based company's president, said in a telephone interview yesterday.

The company is widening its reach in a country where economic growth and rising household incomes are stoking demand for medicines and health care. Drug sales in India may increase 10 percent this year and next, outpacing global growth of about 7 percent, pharmaceutical research company IMS Health said last month.

Apollo's shares rose 0.2 rupee to end trading at 464.15 rupees on the Bombay Stock Exchange. The stock has declined 7 percent this year.

Apollo also plans to buy more hospitals in the country as the need for medical treatment grows in the world's second-most populated country. It already owns 22 hospitals in India and manages 19 hospitals locally and in countries including Bangladesh and Nigeria.

It's seeking facilities in Mumbai and cities in the Indian states of Uttar Pradesh and Andhra Pradesh, Padmanabhan said.

``We are actively looking at acquisitions of hospitals,'' he said. ``We're looking at valuations.''

Apollo, which hasn't set aside any money for acquisitions so far, has 1 billion rupees in cash available from its sale of securities overseas last year, Padmanabhan said. It would also consider borrowing from banks or the overseas-sale of bonds that can be exchanged for shares to make its purchases, he said.

The company plans to double the number of hospital beds it owns and manages to 14,000 in five years, and is management contracts in the Caribbean including Barbados and the Bahamas.