Practo says it will be profitable by next fiscal, IPO also on cards: Report

Tencent-backed telemedicine and mobile health start-up Practo is aiming to turn profitable in the next fiscal and will be looking to float its initial public offering (IPO) soon, CEO and co-founder Shashank Navalurkar Dattatreya has said. He told news agency PTI that the health startup is planning to enhance its presence in smaller cities and towns and utilise AI to give more insights for its effective operations.  

Established in 2008, Practo is an online appointment booking and telemedicine platform, where patients can touch base with doctors, surgeons, clinics, hospitals, pharmacies, and diagnostics. It also offers online consultations and home delivery of medicines. It ventured into secondary care surgery service in 2021.

Shashnak told PTI that the start-up is already cash flow positive and will post an improved EBITDA next year. "This year we will grow by a healthy growth margin... Our EBITDA would have improved dramatically from last year. We will be near break-even this year and next year we will be able to show significant profits."

As per its latest consolidated financial statements, Practo effectively reduced its losses by 58 per cent, though there was a slight decline in its growth momentum in FY23 as compared to FY22.

Practo’s revenue from operations decreased by 3.2 per cent to Rs 204.4 crore in FY23 from Rs 211.2 crore in FY22, as per the consolidated financial statements filed by Practo Pte Ltd in Singapore.

Diagnostic and consulting services contributed 50 per cent to the total operating revenue, witnessing a growth of 9.7 per cent to Rs 102 crore in FY23. The remaining income is derived from subscription services, software sales, maintenance services for doctors and clinics, and other operational activities. Practo operates through 12 subsidiaries located in India, the US, the Philippines, Malaysia, Indonesia, Brazil, Mexico, and Chile.

The company said its strategic cost-cutting measures, particularly in advertisement and consultation costs, led to an impressive 58 per cent reduction in losses, bringing them down to Rs 99.4 crore in FY23 from Rs 236.5 crore in FY22. The company’s ROCE and Ebitda margins improved to -37 per cent and -39 per cent, respectively. On a unit level, the company spent Rs 1.69 to earn a rupee in FY23.

Earlier, the company’s revenue grew by 100 per cent overall from Rs 105 crore in FY21 to Rs 200 crore in FY22. It also saw its overall losses spike from Rs 79 crore in FY21 to Rs 146 crore in FY22.

Practo claims to have 150,000 doctor partners on board, and around 1.7-1.8 million visitors come to its platform every year for consultation. It is present across 720 cities, 13,900 pin codes across 20 countries. About a million appointments are booked every year on the platform.

Also read: IPOs to compulsorily have T+3 listing from today; funds to unblocked earlier

Also read: Flair Writing makes stellar D-st debut; lists at 65% premium at Rs 503 on BSE

Also read: Tata Tech shares crash 8% amid profit booking; m-cap slips below Rs 50,000 crore mark