Practo, the Tencent-backed healthcare and diagnostics app, is setting its sights on achieving profitability in the next fiscal year. The company’s Co-founder and CEO, Shashank ND, recently disclosed plans for an Initial Public Offering (IPO) while emphasizing the integration of artificial intelligence (AI) for enhanced healthcare data analysis.
Founded in 2008, Practo has evolved into a pivotal platform connecting doctors with patients, offering a range of ancillary services, including telemedicine. In a recent interview with PTI, Shashank shared optimistic insights, stating, “Our Ebitda would have improved dramatically from last year. We will be near break-even this year, and next year is when we really will be able to show significant profits.”
The fiscal year 2022-23 marked a significant milestone for Practo, with the Bengaluru-headquartered firm successfully halving its losses to Rs 93.68 crore. Revenues experienced a year-on-year growth of 3%, reaching Rs 194.53 crore, while Earnings before interest, taxes, depreciation, and amortization (Ebitda) showed an impressive 39% improvement.
Diagnostic and consulting services played a crucial role, forming 50% of the total operating revenue. The remaining revenue came from subscription services, software sales, and maintenance offered to doctors and clinics.
Practo’s commitment to achieving full-year profitability in the upcoming fiscal year aligns with its broader strategy of sustainable growth and delivering exceptional service through a comprehensive, full-stack model.
With backing from Tencent and venture capital funds Peak XV Partners and Matrix Partners, Practo is gearing up for an offline presence in primary and secondary healthcare by establishing Practo-branded clinics. Shashank expressed confidence in this strategy, stating, “I think that’s something that we have cracked, and now it’s for us to continue to grow at a rapid pace.”
The prospect of a public listing is also on Practo’s radar. Shashank confirmed the company’s desire to go public, adding, “I do see the company going public soon, but I don’t think there’s any particular timeline for it. Two years, three years from now, we need to see.”
Identifying the domestic market as a priority, Shashank outlined Practo’s plans to deepen its presence in different geographies over the next few years. The company currently connects around 15 crore people annually with doctors in India, with 6-7 top cities accounting for more than 50% of its business.
Having established a strong foothold in major cities, Practo is now shifting its focus to expanding operations in Tier and Tier 3 cities and towns. Shashank stated, “Now we believe that the next phase is to create a more omni-channel approach where online and offline, you know, kind of go hand in hand.”
The incorporation of AI in healthcare is a key aspect of Practo’s strategy, unlocking new possibilities in data analysis for more accurate and efficient outcomes. Shashank highlighted the significance of even a 2% improvement in quality, noting that it could translate into a life saved in healthcare.
Addressing the financial aspect, Shashank reassured that Practo is well-capitalized, with no immediate plans to raise funds. The company has raised approximately $230 million in multiple funding rounds and operates globally, helping over 30 crore patients by connecting them with around 1.5 lakh verified doctor partners.
Shashank emphasized Practo’s focus on strengthening existing businesses while steering clear of other verticals like diagnostics. Despite recognizing the favorable margins in diagnostics, he affirmed Practo’s comfort in staying on the provider side, considering the vast opportunities within that domain.
