Raffles Medical

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Down Time

Raffles Medial was founded in 1976 by Dr Loo Choon Yong and Dr Alfred Loh starting with two clinics in the Central Business District. The company went public in SGX in Apr-1997. An agreement was signed with Pidemco Land to jointly build a 380 beds Raffles Hospital that opened in 31-Mar-2001. 

Business comprises of three segment:

  • Healthcare Services: Medical clinics & general medical services; health insurance, trading in pharmaceutical & nutraceutical products, diagnostic equipment and provides management & consultancy services. 

  • Hospital Services: Specialised medical services, hospital operation and medical laboratory & imaging centre. 

  • Investment Holdings: Investment properties

Raffles Hospital Chongqing (700 beds) commenced operation on Jan-2019. 

Raffles Hospital Shanghai (400 beds) commenced operation on Jul-2021. 

In FY21, 91% of business were from Singapore, 7% China / Hong Kong and 2% for Rest of Asia - consisting of Japan, Cambodia, Vietnam & Indonesia. 

Raffles Medical footprints in China cities comprises Beijing, Dalian, Chongqing, Nanjing, Shanghai, Shenzhen, Tianjin and Hong Kong SAR. 

Financial FY-2021

Revenue increased 27% to $724M and net profit 28% to $84M. Gross margin firmed at 21.3% after a long downtrend. Net margin likewise stabilised at 11.6%. 

Healthcare Services revenue & earning grew significantly in FY20-21 as the firm expand Emergency Care, vaccination centres and Covid-19 test facilities in collaboration with government effort to battle the pandemic. 

Hospital Services earning peaked in FY15 and have trended lower since due to competition from neighbouring hospitals and later pandemic cutting off oversea clients. Sharp increase in depreciation from $13M in FY15 to $37M in FY21 was also another major factor. 

Opinion

Singapore has relaxed rules to 'living with Covid' with 93% of eligible population vaccinated. Healthcare will likely see a dramatic reduction in revenue & earning contribution in FY22. 

As for hospital services, medical tourism will gradually improve in Singapore. Business improvement in Chongqing and Shanghai will be gradual as China is still embracing a zero-Covid policy.