India: Reliance expands healthcare portfolio with Netmeds deal

Mukesh Ambani Photographer: Simon Dawson/Bloomberg

Reliance Industries Ltd’s latest acquisition of a 60% stake in online pharmacy Netmeds for 620 crore will not only strengthen its e-commerce play, but also add significantly to the healthcare portfolio that RIL is building on the back of Jio.

With a series of acquisitions in the healthcare space, including Karexpert, C-Square and Netmeds, RIL will eventually integrate its brick-and-mortar presence in the segment with its tech-enabled offerings to create a bouquet of services that can be monetized through delivery, transaction-based services and subscription services.

“Reliance should have significant advantage with its large physical retail presence and should significantly expand the online medicine market in India,” said Credit Suisse in a research report dated 19 August, commenting on the Netmeds acquisition.

Reliance Life Sciences or RLS, the biotechnology company from the promoter group of RIL, started the largest testing facility for covid-19 this May, doing more than 2,000 tests per day. RLS also plans to start pathology labs across India through partnerships with local entrepreneurs.

Integrating these offline initiatives will be RIL’s Jio Health Hub app, which was launched in January 2017. The app offers lab tests and health check-ups where tests can be booked for home collection and the report is delivered directly on phone. It also allows booking doctor consultations online.

“Though competition is high in this space, RIL has access to the incumbent 400 million subscriber base of Jio,” said BofA Securities in a research report on 4 June, adding that the Indian pharmaceutical market has one of the lowest prices, making it the third largest in terms of volume and 13th largest in terms of value in the world.

“We estimate the domestic retail market to grow at 10-12% CAGR to $30 billion by 2024, driven by increasing affordability, rising healthcare awareness (and insurance) and technology-led investments to improve supply chain efficiency,” said BofA Securities.

RIL, which invested 10 crore in health-tech app Karexpert in May 2018, has its services integrated with Jio Health Hub. Karexpert uses cloud-based technologies and connects healthcare providers with patients.

C-Square, which sold a 82% stake to RIL, provides software solutions with a focus on the pharma sector for distribution, retail, e-commerce and automation, something that allows RIL to expand into pharma e-tailing as a part of its new commerce initiative.

This article was first published on livemint.com.

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Following vacancies can be applied for (only in Singapore).   

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.