Square, Samorita hospitals’ business make a strong comeback

The business of Square Hospital and Samorita Hospital bounced back strong in fiscal 2020-21 from the Covid-19 fallouts.

Like Square and Samorita, all reputed private hospitals did well in the last fiscal year.

Dr AM Shamim, managing director of Labaid Group, told The Business Standard, all crises have a silver lining. Here the positive aspect is that the pandemic has reduced the people's tendency to seek treatment abroad.

"People are not thinking about money for treatment now. They used to bother with hospital bills but now they say that no matter how much money is spent, the treatment should be good," he added.

"The number of patients with other diseases has also increased, helping private hospitals make a comeback in business."

He said hospital owners have also increased investment to provide better services as they have realised that even with good services the hospital business can make a good profit.

The revenue of Square Hospital, an associate company of Square Pharma, which is listed on the capital market, grew 18% to Tk439 crore in fiscal 2020-21.

Its net profit also jumped 217% to Tk41.48 crore, compared to the previous fiscal year.

It also kept the growth momentum in the first quarter of this fiscal year and thus Square Pharma earned Tk5 crore from the hospital, which was Tk4.40 crore at the same time a year ago.  

Due to the Covid-19 outbreak and the consequent countrywide general holidays for more than two months, Square Hospital's revenue dropped 6% and profit 20% in fiscal 2019-20.

Besides, Samorita Hospital, a listed private medical service provider, also recovered from the pandemic blues in the last fiscal year.

Riding on the strong performance, its share price jumped 72% to Tk103 in the last three months till September at the Dhaka Stock Exchange (DSE).

But due to price correction mood in the stock exchanges, its share price came down to Tk80 and the share closed at Tk86.50 each on Wednesday.

In FY21, Samorita Hospital reported a 23% growth in revenue to Tk39.36 crore and profit jumped 12 times to Tk4.20 crore.

The company maintained the growth momentum in the July-September quarter of the current fiscal year. Its revenue grew 29% to Tk12 crore and net profit jumped 217% to Tk1.08.

The medical service provider said in its financial report, the revenue has increased for providing treatment to more Covid-19 patients. The profit jumped as the cost of direct materials and administrative expenses has decreased.

But in FY20, its revenue and profit dropped 14% and 90% respectively.