Krishna Institute of Medical Sciences Ltd. (NSE: KIMS) Q4 FY22 Earnings Concall dated May 19, 2022
Corporate Participants:
Rahul Jeewani — IIFL Institutional Equities — Analyst
B. Bhaskar Rao — Managing Director
B. Abhinay — Chief Executive Officer
Vikas Maheshwari — Chief Financial Officer
Analysts:
Praveen Sahay — Edelweiss Financial Services — Analyst
Anubhav Aggarwal — Credit Suisse — Analyst
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Pritesh Chheda — Lucky Investment Managers — Analyst
Sanjay Awatramani — Envision Capital — Analyst
Nidhi Babaria — Dalal & Broacha Stock Broking — Analyst
Anubhav Sahu — Moneycontrol Research — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to the KIMS Hospital Q4 FY ’22 Earnings Conference Call, hosted by IIFL Securities Limited. [Operator Instructions] Please note that this conference is being recorded.
I now hand the conference over to Mr. Rahul Jeewani from IIFL Securities Limited. Thank you, and over to you, sir.
Rahul Jeewani — IIFL Institutional Equities — Analyst
Yeah. Hi. Good morning, everyone. This is Rahul from IIFL Institutional Equities. I welcome you all to the fourth quarter earnings conference call of KIMS Hospitals, and I thank the KIMS management team for giving us the opportunity to host this call today.
From KIMS, we have with us Dr. Bhaskar Rao Bollineni, Founder and Managing Director; Dr. Abhinay Bollineni, Executive Director and CEO; and Mr. Vikas Maheshwari, CFO.
Over to you, sir, for your opening comments.
B. Bhaskar Rao — Managing Director
Good morning, Rahul, and the — all the investors who are present on this day. I extend a hearty welcome to all of you for the investors meeting. The corona wave has gone, but the heat wave is on. The country is reeling under sweltering heat and I hope you are taking all necessary precautions to safeguard yourselves. Healthcare experts, we are always concerned about your health.
Coming to financial health, the Board had approved the results for the period ended 31st March 2022. I’m happy to announce that the results have been healthy, all parameters showing an upward trend. First of all, the results of quarter 4 FY ’21-’22, the consolidated total income show an increase of 5% against quarter 4 FY ’20-’21, which stood as INR3,805 million for quarter 4 ’21 and ’22. Consolidated EBITDA for quarter 4 ’21-’22 had shown an increase of 16%, corresponding period of quarter 4 ’20-’21 stood at INR1,218 million for quarter 4 ’21 and ’22.
Now, I will present details for the full financial year ’21 and ’22. The consolidated total income for financial year ’21-’22 recorded as an increase of 25% at INR16,711 million over the financial year ’20-’21, which was INR13,401 million. Consolidated EBITDA grew by 41% from INR3,800 million to INR5,360 million for financial year ’21 and ’22, mainly due to a case mix, payer mix and cost optimization. Consolidated PAT saw an increase of 67% from INR2,055 million to INR3,438 million. EBITDA margin grew from 28% previous year to 32% in current year, primarily due to effective cost control and operating leverage. Earning per share on a diluted basis has increased from INR43.69 in FY ’22 against INR26.42 in FY 2021.
Moving to operational highlights. IP volume grew by 17% and OP volume grew by 22% financial year ’21 to financial year ’22. Average revenue per operating bed improved INR25,215 in FY ’22 from INR20,609 in FY ’21, mainly due to better payer mix and increase in complex surgeries and procedures. Average revenue per patient increased from INR1,13,904 in FY ’21 to INR1,21,232 in FY ’22.
The clinical achievements during this quarter: world’s best auto guide implantation for deep brain stimulation using artificial intelligence done by neurosurgeons at KIMS Hospitals, Secunderabad; doctors at KIMS Secunderabad gave a prosthetic testis to a 23-year-old who had lost it due to genetic reasons in childhood; complex case of Tail Gut Cyst treated successfully by doctors at KIMS Hospital, Kondapur; puerperal woman suffering from clots in legs treated without surgery at KIMS Hospital, Kondapur; 9 months baby underwent successful liver transplant surgery at KIMS Hospital in Secunderabad; a five-year-old girl with a large coronary cameral fistula, a rare congenital problem, was successfully treated at KIMS ICON, Vizag; a 42-year-old gave birth to pre-term baby successfully at KIMS SAVEERA, Ananthapur; a 10 months baby successfully underwent a complex kidney surgery at KIMS SAVEERA, Ananthapur; complex case of pituitary tumor treated successfully at KIMS ICON, Vizag; critical procedure of left main bifurcation was successfully done through angioplasty at KIMS ICON, Vizag; in a rare feat, KIMS Kurnool doctors removed 11 bone formations around ankle of a patient; KIMS Kurnool doctors performed a rare procedure by inserting a stent in the liver to save the life of the patient. Successful treatment of such critical cases is a matter of great professional satisfaction and speaks volumes about the professional expertise and medical infrastructure available with us at various centers.
Why have I explained various clinical achievements in such a detail is to show you how quality care at affordable cost is made available across all the centers of KIMS uniformly. It is not just a confine to Secundrabad or Kondapur, but all our centers’ excellent treatment and facilities are available as we always feel as a KIMS family treating the good patients, getting a good brand, it always in reflects the investors investment.
Digital initiatives, there is a steady progress in digital transformation with the notable initiatives as below. Remote patients monitoring technology was developed in the watch integrated with a digital nursing application. Digital applications are flexible to meet the needs of bed management and telemedicine consultation of Omicron COVID cases, resulting in a safer and convenient patient experience during challenging times. KIMS Hospitals is well on the way to take the next steps in doctors ordering tests on a mobile app, completely digital patient experience and resource optimization. We are continuously taking initiatives for digital progress to achieve optimum results.
ESG initiatives: as mentioned in our earlier meetings, KIMS Secunderabad has partnered with the Smart Joules Private Limited, a prominent energy service company in 2018. A new and innovative model known as JoulePAYS was executed wherein, KIMS makes zero capital investment to implement various energy conservation measures across the hospital, gets a guaranteed energy saving minimum of 10% annually over the baseline energy consumption. For FY ’21-’22, the total energy consumption saved worked out to 23.1%. Total energy cost saving achieved amount INR280 lakhs. In real life terms, the energy conservation achieved translates to following: 38,178 households getting electricity, 93 lakhs kms less driven, 94,366 trees planted.
Expansions: we have a vision to strategically expand our presence in various places. We extend our reach to the needy and further enhance value of our investment — your investment. In the last meeting, I apprised you about our acquisition of the prestigious Sunshine Hospitals that have become a part of KIMS now. Today, I’m happy to announce yet another stride made by us in the trajectory of our expansion. KIMS entered into an MOU with Dr. Raj Nagarkar of Manavata Hospitals to set-up a multi-specialty hospital known as KIMS Manavata Hospitals Nashik with a bed capacity of 320 beds with a cost of INR200 crores to INR250 crores. KIMS will hold a majority stake of 51% in the proposed hospital. Dr. Raj Nagarkar, our collaborator, is a legendary oncological surgeon with a rich experience of more than two decades. The hospital is expected to start functioning by March 2024. We find that there is a lot of potential in Maharashtra. We are confident that our foray into Nashik will pave way for the further expansion in Maharashtra in coming years. Our presence in Central India will give a fillip to our Group in its drive. Earlier we had plans to set up our foot in Chennai. We found this opportunity in Nashik to be more attractive and full of potential. Our expertise in running hospitals, state-of-the-art infrastructure, coupled with vast reservoir of goodwill of Dr. Raj Nagarkar due to his long-standing reputation in Nashik, which stand us in a good steady and yield good results. This is a special news for this meeting and I am sure you are happy with the development. What we have been already done with Sunshine Hospitals, we are progressing much more than what we expected.
There is another good news for all of you. Gradually the threat of COVID has receded and we are back to normal levels of activity. The footfalls also increased post-COVID. As you are aware, KIMS has made a name for itself in organ transplantation, and we are happy to state that we are able to sustain the good work in the specialized areas. KIMS is once again a vibrant in the academic field in a number of seminars and workshops are taking place on a regular basis as before. I am glad to announce that shortly we are coming with a KIMS newsletter on wellness every month. And we intend to send the same to all our shareholders. This will have valuable tips on health, wellness and other related issues. I’m sure you’ll find it useful. We have your email IDs with us. And with your permission, we’ll be sending you the bulletins that will be beneficial to you.
I would like to conclude now assuring you that we will be on the forefront and serving the patients and also protecting them and promoting the interests of our investors.
Thank you very much. We can open it for questions.
Questions and Answers:
Operator
Thank you very much. [Operator Instructions] The first question is from the line of Praveen Sahay from Edelweiss Financial. Please go ahead.
Praveen Sahay — Edelweiss Financial Services — Analyst
Good afternoon, sir. Thank you for taking my question. So the first question is related to the matured facility, that is Nellore, Rajahmundry and Srikakulam. If I look at the revenue in the last three years, were not grown much out there. So can you give a guidance related to these facilities, how you are looking at?
B. Abhinay — Chief Executive Officer
Yeah. So these facilities have not been able to grow in the last three years, but largely because of capacity constraints. So all three hospitals, we have — all three locations, we have taken initiatives, where we are going to build new facilities and expand the current hospital, which will add more bed capacity and new clinical specialties, which will help them grow. All of them are — for example, Srikakulam, we have already had land parcel in the Company for quite some time. This year, we’re pretty confident we will get permissions to scale up the current bed capacity by an incremental 150, 200 beds and add a lot of new clinical therapies, which will help almost double the occupancy over a period of time.
Like is the case with Nellore. We had made some structural changes to the way that was operating. Because of bed crunch, we had to let go of Aarogyasri as a scheme in Nellore, because we had overwhelming footfall from cash patients. We recently acquired a piece of land which is a kilometer away from the current hospital. We believe that we can construct at least 200 beds largely for scheme patients and other new clinical therapies. And that will also help Nellore grow.
As far as Rajahmundry, this has been a very promising hospital in Andhra. Unfortunately, we’ve not been able to get the right land parcel for us to build a very large campus. Current one is only 120 beds and largely driven by cardiac. But in the next two, three months, we should conclude on land and then be able to build a larger hospital, so that we can add new therapies like oncology, mother and child, give space for the other specialties to grow.
Praveen Sahay — Edelweiss Financial Services — Analyst
Sir, helpful.
B. Bhaskar Rao — Managing Director
To add more on what Dr. Abhinay has pointed out, this is the three hospitals which were build with less than 200-bed capacity in the beginning, then we realized that most of our hospitals done this is more than 400, 350 like that.
Praveen Sahay — Edelweiss Financial Services — Analyst
Helpful, sir. So related to that, as you had said, the two of the facilities are expansion of beds, also you had a Sunshine, which is a lower occupancy to improve, then again, you had acquired in the Nashik. Further there is also chances in the earlier calls you had said about the Mumbai as well. So, like, how you are actually planning your entire asset, like everywhere the expansion and good expansion you are and the JV also, you are going ahead with? So what’s your strategy the way forward for a total — how much is the bed capacity you are looking at in the near-term in the next two years’ time? And how to make them fully operational and improve the operational efficiency there? Can you talk about that?
B. Abhinay — Chief Executive Officer
Sure. So, I think, like we said in our presentations earlier, we are focusing only in cluster growth and cluster approach. So earlier we were talking about further consolidating in AP and Telangana then going greenfield in Karnataka, Tamil Nadu, and looking at acquisition opportunities in Central India. And we still continue to wanting to do the same. We are adding more capacity in Telangana. For example, we recently acquired Sunshine. We’re trying to — we are expanding the current Sunshine Hospitals, so that we can bring in more clinical therapies and more clinicians. And we are also improving the EBITDA margins. If you look at what Sunshine was able to do over the last four, five years, we have actually, in the last five, six months been able to make significant improvement. And we believe once they move to the newer facility and the newer beds are operational, we will then be able to further optimize the revenue and further optimize the cost.
As far as Andhra is concerned, largely about expanding the mature and non-mature hospitals ranging from 50-bed addition to almost 150, 200 beds addition. So this consolidates almost 1,800 incremental beds over the next three to fives years just in AP and Telangana, which is the core market out of which we operate. Now beyond this, we said Karnataka, Tamil Nadu and Maharashtra. We have decided to put Tamil Nadu on hold given the opportunities that we are getting in Central India and Maharashtra. And we believe that we will only look at acquisitions for the short-term in Maharashtra, where it could be joint ventures, maybe brownfield. And that’s how it is all panned out. So whatever we are looking in Nashik, in Bombay, in Nagpur and few other micro-markets, all of them are in partnership with local doctors and all of them are either operational or to be operational in short-term. And because we have a very strong local doctor clinic and local partnership, our resources always been that we look at partnership with doctors, be able to attract good talent and that will help propel and grow the hospital. That’s what we are continuing to do.
As far as Karnataka is concerned, because we believe a large opportunity is there, we have a very strong management team on ground. We want to build a greenfield opportunity in that market, because it’s very synergistic to AP and Telangana.
Praveen Sahay — Edelweiss Financial Services — Analyst
Thank you, sir. And last question on the some bookkeeping. So, how much is on ALOS for Q4 and how much is the operating bed currently you have? And also, can you give some capex number for FY ’23 and FY ’24?
B. Abhinay — Chief Executive Officer
Sure. I think, the ALOS, I will take. I will have Vikas answer the rest of it. The ALOS for Q4 is 4.6 against 4.7 of quarter 3 for FY ’22.
Vikas Maheshwari — Chief Financial Officer
And as far as the debt is concerned, Praveen, there is still a net cash surplus company on the gross debt side, we have the debt of around roughly INR146 crore, but against that, we have a fixed deposit of INR155 crore plus cash balance. So it is the net cash surplus company as on date so far.
Praveen Sahay — Edelweiss Financial Services — Analyst
No. So, capex for ’23-’24 sir?
Vikas Maheshwari — Chief Financial Officer
Capex for ’23, it all depends upon — Praveen, depends upon the opportunities, which we are pursuing and fructifying. So we expect this — Bangalore, we have taken the definitive steps and the Nashik’s we have taken the definitive steps. So on these two assets, we have already told that in the Nashik we’ll be spending roughly in the first phase INR160 crore to INR180 crore to set-up first phase of the hospital. And for the Bangalore, we’ll be spending something like the INR325 crores, INR350 crore. So we expect that Nashik’s money to go in the next 12 months’ time and the Bangalore almost 70% to 75% and all depends upon the balance opportunity which fructifies which we are pursuing right now. So there is a two clarity right now in terms of brownfield acquisition, which we are pursuing is Bangalore and Nashik. On that, roughly, you can take roughly INR500 crores outflow on these two assets, 18 months’ time, 12 to 18 months’ time.
Praveen Sahay — Edelweiss Financial Services — Analyst
Yeah. Thank you, sir. And the operating bed, sir, currently we have total?
Vikas Maheshwari — Chief Financial Officer
The operating beds have not changed from the last — which we have seen in the quarter 3. So the operational beds remains 2,246 on the bed capacity of 3,064.
Praveen Sahay — Edelweiss Financial Services — Analyst
Yeah. Thank you, sir. Thank you. Thanks a lot for answering my questions.
Vikas Maheshwari — Chief Financial Officer
Thank you.
Operator
Thank you. The next question is from the line of Anubhav Aggarwal from Credit Suisse. Please go ahead.
Anubhav Aggarwal — Credit Suisse — Analyst
Hello?
B. Bhaskar Rao — Managing Director
Hi, Anubhav.
B. Abhinay — Chief Executive Officer
Hi, Anubhav.
Anubhav Aggarwal — Credit Suisse — Analyst
Morning to all. Thanks for my turn. Just a clarity on this Nashik expansion. So you guys have 51% stake, so INR160 crore, INR180 crore is all what you will be putting in? So, Dr. Nagarkar is not putting in his equity?
Vikas Maheshwari — Chief Financial Officer
So, Anubhav, it is a partnership between 51% and 49% with Dr. Nagarkar. So the project cost is estimated to be at around INR160 crore to INR180 crore for the first phase. And out of that, roughly INR100 crore will bring as equity, INR90 crore to INR100 crore will come as the equity and the balance as a debt. So we will be infusing something like that INR40 crore to INR50 crore as equity. The balance work will be infused by Dr. Raj Nagarkar. Actually the asset is already — so land and building is already in his name. So that will come as a equity into the Company, so which is being valued — in the process of being valuation. So we expect the valuation should be at around INR40 crore to INR50 crore. That will come as an equity as his part and then balance we will infuse. So that is the structure as of time.
Anubhav Aggarwal — Credit Suisse — Analyst
Okay. That’s helpful. And about Dr. Nagarkar’s role, so I see that he also has 49% stake in HCG Manavata and he will have 49% stake this one. So that’s the oncology one, this is a multi-specialty one, but his role will — he’ll continue to have a dual hat and that’s going to be his engagement in this kind of structure?
B. Abhinay — Chief Executive Officer
So, he is a practicing clinician, Anubhav, so he will continue to play his role as a practicing clinician on the space of oncology. We will continue to build using his contacts, his leverage on the multi-specialty part. But we are not expecting him to pursue anything actively for us in that market other than helping us get access to good clinician and getting access to the right talent in that markets.
Anubhav Aggarwal — Credit Suisse — Analyst
Okay. And what could be potentially ARPOB for this hospital?
B. Abhinay — Chief Executive Officer
So what we’ve noticed in that market is around INR27,000 to INR30,000. But what we have modeled is something around INR25,000 assuming that will be priced little lower than competitors.
Anubhav Aggarwal — Credit Suisse — Analyst
Okay. Useful. Some data point clarity, just first on the payer mix. If I look at your payer mix, which you guys have shared in nine-month for this fiscal and for the full-year. If I try to get fourth quarter out of it, it looks like Aarogyasri patients have jumped up to more than 15% in quarter 4.
Vikas Maheshwari — Chief Financial Officer
Anubhav, you’re correct. So the cash patients in the quarter 4 was 58%. Insurance is the part which has come down from the 20% to 14% and corporate and Aarogyasri has been 27% now. So, that is correct.
Anubhav Aggarwal — Credit Suisse — Analyst
So — but what about if — this quarter some special thing happened or — because this is quite inferior mix, will it continue?
Vikas Maheshwari — Chief Financial Officer
So, Anubhav, very good questions. What we have seen in FY ’22, because of the COVID there were some disruption in terms of the corporate patients coming into the hospital, because in terms of the COVID and high-end patients for the clinical physicians who were coming here were mostly covered under the cash and insurance, and we saw our insurance percentage and both cash percentage going up. So if you go to the history back in ’19-’20, our — if you see in FY ’20, our corporate and Aarogyasri business was roughly 28%, which come down to 22% in FY ’21 and now it is 21% again. For the full-year for the FY ’22, we believe that we will be able to maintain at the same status, which is right now. So for the next year, you will see roughly 70% [Phonetic] coming from the cash and insurance, and more than — roughly 88% coming from — 78% coming from the cash and insurance, and 22% roughly coming from the cash and — Aarogyasri and corporates.
Anubhav Aggarwal — Credit Suisse — Analyst
So you’re saying that 4Q is an exception. This trend will not continue, because you’re guiding that…
Vikas Maheshwari — Chief Financial Officer
Correct. Yes.
Anubhav Aggarwal — Credit Suisse — Analyst
Okay. And just a clarity on Telangana cluster, there the numbers suggest that utilizations have increased dramatically in this quarter and ARPOBs have sharply reduced versus third quarter. For example, numbers seem to suggest that — our numbers seem to suggest that utilization increased almost 60% compared to 50% in third quarter and ARPOBs dropped to INR37,000 versus INR47,000 in third quarter. Are we doing correct calculation or can you guide what are the numbers?
B. Abhinay — Chief Executive Officer
No. I think the occupancies have been very similar in — so in Telangana cluster, we are referring to two hospitals, Anubhav, just to be on the time pace. So we are talking about Kondapur and Secunderabad for the quarter 4, is that the question?
Anubhav Aggarwal — Credit Suisse — Analyst
Yes, correct.
B. Abhinay — Chief Executive Officer
Correct. So, I think — so nothing for this quarter has been substantially different from the quarter before. The ARPOBs remain the same, there has been a 5% dip in volume because of the disruption of the third wave and because of less number of days in February, but that’s usual, but when you compare it to Q3 kind of a number, but it is not that the occupancies have gone up substantially.
Anubhav Aggarwal — Credit Suisse — Analyst
So maybe some error. I can check with Vikas later on this. And just last question on the Sunshine. What is the utilization that we’re operating it right now or, let’s say, in the 4Q what is the utilization?
B. Abhinay — Chief Executive Officer
In Q4, it is still around that 50% kind of an occupancy. But what we have been able to do so far is a lot of operational efficiency has been brought in. Revenue ramp-up, I don’t know if you’re aware of what we’re doing with Sunshine, but there are two facilities. One of the facility, we have already started rebranding it and renovating it, which is in Gachibowli and we believe by end of this financial year, we’ll be able to take it to a 55%, 60%, 65% kind of an occupancy from our current 35%, 40% occupancy.
The other facility, which is in Begumpet, which is running currently at 50% occupancy, we are moving that out from the current building to a new facility, which will be little larger, more attractive to attract clinicians and patients. We are hoping that will happen by end of the year. Once that happens, we are expecting that the revenue growth from there will be — the overall revenue potential growth could be on an upside of 35%, 40%, and also a lot of that will translate to operating leverage and better margin expansion.
Anubhav Aggarwal — Credit Suisse — Analyst
Okay. Thank you.
Vikas Maheshwari — Chief Financial Officer
Thanks, Anubhav.
Operator
Thank you. The next question is from the line of Bhavya Gandhi from Dalal & Broacha. Please go ahead.
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Yeah. Thank you for taking my question. Can you hear me?
B. Abhinay — Chief Executive Officer
Yes, yes, we can hear you.
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Yeah. Sir, I just wanted inpatient revenue and outpatient revenue for entire year and for the quarter.
B. Abhinay — Chief Executive Officer
Inpatient revenue and out-patient revenue for the quarter?
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Yeah. And for the entire year. Revenue is not mentioned, it’s the only volume figures which have been mentioned.
Vikas Maheshwari — Chief Financial Officer
So I can give it [Technical Issues] roughly 108 was the IP revenue and the balance is the pharmacy and OP revenue.
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Okay. And for the year, entire year?
Vikas Maheshwari — Chief Financial Officer
This is for the entire year I told you.
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Okay, okay, 108.
B. Abhinay — Chief Executive Officer
He is asking the quarter.
Vikas Maheshwari — Chief Financial Officer
And the quarter was 315 was — sorry, 240 was IP revenue, and the balance was pharmacy and OP.
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Okay. Thank you. And sir, one more question on cash flow front. So last year, cash flow from operations was roughly INR350-odd crores, which has dipped to INR325-odd crores. So any specific reasons, because I see the taxes paid are from almost INR37 crores to INR127-odd crores. So what is our assessment over there? Because we’ll have to reinvest those cash flows for the acquisitions, right?
Vikas Maheshwari — Chief Financial Officer
No. So the cash flow, what has happened in the FY ’21 was Phase 1, but going on the government was very proactive in releasing the income tax refund, etc. So whatever the cash flow items you are seeing for the tax payment, roughly INR40 crore was the tax refund, which we have listed. So if we adjust to that, I think you will get to that number.
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Okay. And what…
Vikas Maheshwari — Chief Financial Officer
It’s not changed much.
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Yeah. So what is the run rate that we can expect roughly EBITDA to OCF what kind of — OCF to EBITDA conversion would be maintained at current level?
Vikas Maheshwari — Chief Financial Officer
So you are asking for cash generation means net of the working capital adjustment.
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Yes.
Vikas Maheshwari — Chief Financial Officer
We have seen roughly 67% generation of the net operating cash flow from the EBITDA. I think we should be at 67% to 70% run rate on this.
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Okay. And sir, talking about the competitive landscape, we see lot of regional players also scaling up fast. We see lot of organized listed players also loaded with cash. So any competitive landscape, if you could provide?
B. Abhinay — Chief Executive Officer
Competitive landscape in our geography, in the geography we operate?
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Yes, sir. And what are the number of beds per thousand patients something of that sort?
B. Abhinay — Chief Executive Officer
Okay. So Hyderabad has always been a very competitive market. I think the bed addition in the organized sector or what we consider as competition for the last three years or three to four years, we’ve been seeing at least 500 to 700 beds being added on a year-on-year basis, but I think except for one hospital that is scheduled to be commissioned by end of this year, we are not seeing anything in the near future, that is for the next three to four years come up in a large scale. So — and in spite of the beds that got added in the last three, four years, we’ve been able to scale up pretty well in our existing hospitals. So beyond this year, we don’t see anymore incremental beds, most of whatever is getting added is coming from KIMS itself in two of its facility as far as Telangana is concerned.
As far as Andhra is concerned, I think there is still a huge opportunity. The competition is far from few in most of the geographies that we operate except for one or two where competition has caught up and there is visibility of more beds being added, we don’t see a major challenge at all in Andhra in scaling up further.
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Okay. And rough assessment if you could give me as to how many beds are required in Telangana per 1,000 or 10,000? And what is the current status right now, as well as in Andhra Pradesh?
B. Bhaskar Rao — Managing Director
Yeah. To give the clarification on that, see, basically in this country, you cannot able to measure per 1,000 beds — per 1,000 population how many beds required. The reason is, in the developed countries, every nook and corner there is a good healthcare facility that is available. Today, the population what we have in Telangana, especially in Hyderabad, still gets lot of beds are been at least 25% to 30% of the beds are coming from outside states like Maharashtra, Madhya Pradesh, West Bengal, Orissa, all these places. That’s why once those units has been done with the required infrastructure, and especially the quaternary care is very, very well developed in Telangana, Hyderabad. So once that is there, then still whatever you are — we are thinking about the population of Hyderabad and the number of beds as on today is definitely more than expected. But because of this inflow coming from all over the states, neighboring states and far-off places, that will — is the one the competition may not be very high in coming years, the number of beds that the competitors are building and we are also building. I think, still there is a space for the — for every person, and ultimately, it depends upon the good talent we can able to get and good corporate governance and the patient friendly like affordable quality care that is the most important which is going to take which competitor or maybe which unit is going to take forward.
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Right. Sir, my last question, so Secunderabad to Nashik is roughly 13-odd hours, almost 730 kilometers. So do we have a brand visibility in Nashik also, Secunderabad to Nashik? Because this is a bit deviating from our overall strategy to grow in periphery [Phonetic].
B. Abhinay — Chief Executive Officer
No, I think, it’s part of the strategy for us to grow in Maharashtra, where we see a lot of patients come in from the Vidarbha region. So it may not be exactly from Nashik, but that whole Amravati Belt, Nagpur, and that entire zone; we see Yavatmal and all we see a lot of patients come in. And here in Maharashtra we see a big vacuum in the number of beds required versus the number of hospitals present. So if I have to look at trying to build a Maharashtra story, I think, I have to focus on your top five markets first, and then look at going into Tier 2, Tier 3 locations in those geographies. And in Nashik, though, we’ve been studying that market for a long time, getting a good partner like Dr. Raj, who has built a phenomenal oncology hospital and who has phenomenal connect is, I think a very good entry strategy. I mean, one couldn’t ask for something much better and larger than this as far as our entry to Nashik is concerned.
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Right. That’s helpful, sir. Thank you so much. I’ll get back in the queue.
B. Abhinay — Chief Executive Officer
Thank you.
Operator
Thank you. [Operator Instructions] The next question is from the line of Pritesh Chheda from Lucky Investment Managers. Please go ahead.
Pritesh Chheda — Lucky Investment Managers — Analyst
Yeah, sir. Just wanted to understand in terms of the operational beds, what is the addition that we will see over the next couple of years, because I think it has to be from your existing assets only, right?
B. Abhinay — Chief Executive Officer
How many incremental beds are we going to add in the next two years?
Pritesh Chheda — Lucky Investment Managers — Analyst
Two years, yeah, in terms of operational? So you said you have 2,246 as operational beds. So this operational bed number should be what in next couple of years?
B. Abhinay — Chief Executive Officer
So as far as the current beds of 3,064 bed capacity is concerned, I think all of those will be operational in the next 12 months actually in the current capacity. Like in the case with Sunshine, all the beds will be fully operational, the current capacity and then we are looking at these new expansions into Nashik.
Pritesh Chheda — Lucky Investment Managers — Analyst
Yeah, Nashik and Bangalore that is additional that in any case come in two years from now, right?
B. Abhinay — Chief Executive Officer
No, so — yeah, okay, 18 months from now, we should have both of them operational.
Pritesh Chheda — Lucky Investment Managers — Analyst
Okay. Okay. So basically from a volume growth perspective, we have this 700, 800 beds possible over the next 12 to 18 months before your new asset starts coming in.
B. Abhinay — Chief Executive Officer
Correct.
Pritesh Chheda — Lucky Investment Managers — Analyst
Okay.
B. Abhinay — Chief Executive Officer
Unless we don’t do anything in between.
Pritesh Chheda — Lucky Investment Managers — Analyst
Yeah, unless you don’t do anything in between. This 3,000 beds operational, does it include Sunshine or Sunshine is additional?
B. Abhinay — Chief Executive Officer
No. 3,064 is just the nine hospitals of KIMS. The additional beds of Sunshine — 600 additional beds of Sunshine will be incremental.
Pritesh Chheda — Lucky Investment Managers — Analyst
Okay. Last one question on Sunshine, when should the acquisition gets closed and the numbers should start reflecting for us?
B. Abhinay — Chief Executive Officer
So the acquisition is already completed. So it become our subsidiary with effect from 1st of April 2022. So the first quarter June ’23, FY ’23, you will see the numbers getting integrated.
Pritesh Chheda — Lucky Investment Managers — Analyst
Okay. And what you mentioned in your presentation that the number of KIMS will move to INR30 crores per month in case of Sunshine Begumpet and INR20 crore per month in case of Sunshine in Gachibowli. So this INR50 crores per month or — this is like 100% utilization, right, you are running at 50% today. What should be the timeline for this INR50 crore per month revenue should be?
B. Abhinay — Chief Executive Officer
So, firstly, Gachibowli, we don’t believe will go to INR20 crores a month. I think it will get capped at around INR17 crores, INR18 crores a month, because of some structural changes that we brought in there. But Begumpet will certainly scale up to close to INR30 crores, INR35 crores a month. And once we moved the Begumpet facility, we will need at least two to three years to scale that number, and Gachibowli from April another two years will be — two, three years we’ll be scaling to that number.
Pritesh Chheda — Lucky Investment Managers — Analyst
So the current INR180 crore is — doesn’t include Begumpet numbers, right? The current INR180 crores — the current five months number of INR180 crore which is mentioned in the presentation on Sunshine Hospital…
B. Abhinay — Chief Executive Officer
So what is happening in Begumpet is, the current hospital is a very old facility, so that currently does a revenue of INR20 crores, INR22 crores a month. We are now moving that to a new campus, which is very close by, a kilometer from the current facility. And then we believe from that INR20 crores, INR22 crores it will scale up to 35 — INR30 crores, INR35 crores over a period of three years, once we move there.
Pritesh Chheda — Lucky Investment Managers — Analyst
Okay. Okay. Perfect, sir. This was helpful, sir. Thank you very much.
Operator
Thank you. The next question is from the line of Sanjay Awatramani from Envision Capital. Please go ahead.
Sanjay Awatramani — Envision Capital — Analyst
Yeah. Good morning and thank you for giving me this opportunity.
Operator
Sorry to interrupt you, sir. We are not able to hear your audio clearly.
Sanjay Awatramani — Envision Capital — Analyst
Okay. Am I audible now?
B. Bhaskar Rao — Managing Director
Yes. Little loud.
Sanjay Awatramani — Envision Capital — Analyst
Okay. Thank you for giving me this opportunity. Can you tell me the capex? I mean, if you have told, I think I missed on that. Can you give me the guidance for capex, which you’ve mentioned for FY ’23 and ’24?
Vikas Maheshwari — Chief Financial Officer
So, let me rearticulate it well. So we are pursuing multiple opportunities. And based on our past efforts, we have been able to close Bangalore and Nashik for which there is a visibility. So for Bangalore, already some amount is already spent and we expect in next 18 months’ time the balance amount will go, which will be roughly INR280 crores to INR300 crores for the Bangalore. For the Nashik, the total commitment of the project is roughly INR180 crore to — INR160 crore to INR180 crore, INR190 crore depending upon what type of facility and the infrastructure and specification of the hospital we are bringing there. So that total capex outflow will also happen in FY ’23 or the part of the equity will come from our equity partner and the balance will be from the KIMS and with the loan. So these two projects we have the visibility. Our routine capex is in the range of roughly INR40 crore to INR45 crore, which will continue to happen in this current year. Beyond that, any capex plan, etc., depends upon the opportunities fructifying.
Sanjay Awatramani — Envision Capital — Analyst
Okay, sir. This is very clear, and thank you so much.
Vikas Maheshwari — Chief Financial Officer
Thank you.
Operator
Thank you. The next question is from the line of Rahul Jeewani from IIFL Securities. Please go ahead.
Rahul Jeewani — IIFL Institutional Equities — Analyst
Yeah. Hi, sir. You indicated that you have had a relook at the Tamil Nadu or Chennai expansion, which you were pursuing given that you found — you find the Nashik opportunity to be a better one. But did you see anything incremental in the Chennai market in terms of competitive intensity which has allowed you to postpone your plans? And what gives you confidence with respect to the Bangalore market, given that you were saying that the Bangalore expansion is still on track?
B. Abhinay — Chief Executive Officer
So, as far as Chennai is concerned, it’s not because of the competitiveness. I think it’s just that the opportunities that came up in Maharashtra and shaping that cluster currently was taking priority over setting up one hospital in South Chennai. So we thought it would be more strategic to have these three, four assets that we can commission in Maharashtra over the next two years versus trying to do just one facility in Tamil Nadu for now. So we are just postponing the Chennai project for some time. Nothing has changed in that market or we don’t believe anything will change in that market even in the next short-term to medium-term.
As far as Karnataka is concerned, we always were pretty gung ho about that market. We believe that we’ll have a larger footprint, larger than Tamil Nadu in Karnataka, because of the opportunity in Tier 2, Tier 3 locations and the opportunity in the larger metro, because of the growth rate in that city. So we have taken definitive steps, we bought — we’ve given advance to the property that we want to commission the hospital. In the next few weeks, we will start work on ground. So we’re pretty confident that things will be on track and will be able to commission the hospital as soon as possible.
Rahul Jeewani — IIFL Institutional Equities — Analyst
Sure, sir. So with respect to this Maharashtra expansion, where you want to put out a cluster approach with three to four hospitals, Nashik will be one, probably you might be looking at the Mumbai market as well. Which are the other markets which you are evaluating? And would it be through acquisitions or inorganic — sorry, acquisitions or inorganic route to expansion within these markets?
B. Abhinay — Chief Executive Officer
So, right now, I think, the next 24 months we have focused only on acquisitions. What we will do either acquisitions of a running hospital or that can be operational in six months’ time, that’s what we mean by acquisitions and where there is a good team of clinical talent and big vacuum. So we believe we will be able to do two to three projects certainly in the next 12 to 14 months in Maharashtra.
Rahul Jeewani — IIFL Institutional Equities — Analyst
Sure, sir. And if you look at some of these assets which are available across the hospital space, most of these assets operate a large number of hospitals. So when you are trying to acquire assets, would you acquire single facilities or you would be open to acquiring multiple hospitals as well, the way you did with Sunshine where you got three hospitals?
B. Abhinay — Chief Executive Officer
I think we are open to both, as long as it meets our core fundamentals of us being able to add value in terms of scaling up the hospital, in terms of operational efficiency, bringing in new clinical therapies, if it meets the overall criteria on return on capital, return on equity, I think we are okay to even look at a network or a stand-alone facility.
Rahul Jeewani — IIFL Institutional Equities — Analyst
Okay, sir. And one clarity on the Nashik hospital. You said that Dr. Raj will help you to scale up on the multi-specialty segment. So does that mean that you have a specific agreement laid out that the oncology business will not be serviced by you and that will continue be serviced by HCG?
B. Abhinay — Chief Executive Officer
So there is no such commitment at this point in time that we will do oncology. However, the current facility also houses a bunker, but we don’t intend to do oncology as a service in the near future, but maybe in the long-term if something pans out, then we haven’t really given that much of a thought as far as oncology is concerned. But in the short-term certainly we will not do oncology there.
Rahul Jeewani — IIFL Institutional Equities — Analyst
Okay. And now, if I look at your fourth quarter occupancies, your fourth quarter occupancies appear low even versus 1Q of FY ’21, when the business was impacted on account of COVID disruptions. So post that quarter, fourth quarter occupancy have been the lowest. So what has led to this lower occupancy and do you think that because the COVID business has normalized that has led to lower occupancies and where do you expect to sustain occupancies and ARPOB going forward?
B. Abhinay — Chief Executive Officer
So if you look at Q3 and Q4, there are two — I mean, just look at Q4 of last year and Q4 of this year, one fundamental thing is that, the ALOS has come down from 5.1 in Q4 FY ’21, it has come down to 4.6. So this has some impact on the overall occupancy. And number two, I think, this was very unusual that in January, we had seen the whole COVID scare take a big toll. So usually what happens is the first 15 days of January is very, very dull in the southern — in at least in the geographies that we operate. Right when we were coming out of that space, we saw COVID hit for almost 20, 25 days. And this time, fortunately, we didn’t have to treat patients, because they were all doing well, but a lot of our clinical staff, doctors, all of them started falling sick, because of the infectivity rate. And they were not able to come to work. And because of the COVID scare by and large, a lot of patients stopped coming to the hospital. So we almost lost the full month of January to either recovering from the festival season and then whatever disruption happening because of COVID. So that was one.
And then the month of February had 10% less number of days when compared to any other month in the year. So — and usually March is supposed to be the best month of the year. But I think, because of what all happened in Jan and people had other priorities, it wasn’t as good as how we’ve been anticipated it to be. Then things are now slowly picking up after the lull in April and May, we are seeing the last 10 days picking up in the right trajectory.
Vikas Maheshwari — Chief Financial Officer
Rahul, just to add, if you look at the IP volume of quarter first, which we are referring to and quarter 4 of current, the IP and OP volume both have gone up. What has made change is the ALOS difference, because in the quarter 1, because of the respiratory issues, the COVID second was very dangerous and respiratory issues, the patients were staying little longer with us. So the ALOS has come down, which has also resulted in the occupancy rate coming down, if we are comparing from the quarter first.
Rahul Jeewani — IIFL Institutional Equities — Analyst
Sure, sir. Just a follow-up on that since you referred to IP/OP volumes. Now, if we look at your overall IP/OP volumes, those volumes are still below pre-COVID levels, the numbers which we did in FY ’20. So what kind of a growth are you expecting on the IP/OP volume side for us on an organic basis for, let’s say, FY ’23-’24 ex of Sunshine?
B. Abhinay — Chief Executive Officer
So I think, this year, unfortunately, because both the years you have some breaks of COVIDs in FY ’22 you had this break of COVID. If you look at the normalized month, if you look at Q3, for example, Rahul, which was completely non-disruptive, things we’re doing well, Q2 and Q3 of FY ’22, and you annualize those numbers, it is, in fact, better than what it was pre-COVID from a volume point of view.
Rahul Jeewani — IIFL Institutional Equities — Analyst
Okay. But any number which you would want to give out in terms of the normalization which you expect in the business next year?
B. Abhinay — Chief Executive Officer
So I think, we will definitely perform. From a volume point of view, we should definitely hit back the FY ’20 numbers, obviously, better than the FY ’20 numbers. And in spite of the low — because of our growth in ARPP and the ARPOB, our revenues will also be much better than that of the core [Phonetic].
Rahul Jeewani — IIFL Institutional Equities — Analyst
Sure, sir. So I will join back the queue. Thank you for answering my questions.
Operator
Thank you. The next question is from the line of Nidhi Babaria from Dalal & Broacha. Please go ahead.
Nidhi Babaria — Dalal & Broacha Stock Broking — Analyst
Hi, sir. Thank you for taking my questions. Basically, sir, I want to know what type of tier analysis do we do before entering into new markets? So, let’s say, now we are coming to Nashik, what is our view with regards to some of the hospitals over there, like, we already have Apollo over there and there are some stand-alone hospitals also, Sahyadri and, again, HCG in oncology. So what are the parameters for us to go into these markets?
B. Abhinay — Chief Executive Officer
Sure. So I think one is at a very high level there is significant supply-demand gap, because, just look at HCG as an example, the amount of revenue or volume they do from just one specialty, which is oncology, is equal to the sum of all the departments in a hospital like Sahyadri, in a hospital like Medicover, and double the revenue of a hospital like Apollo. So it is just that we have seen — this is very high level and I’ll get to the details. We’ve just seen that the current facilities have capped themselves at a 150-bed, 170-bed and they have reached a certain capacity on those beds and they have not been able to add incremental beds and hence, we have seen a saturation. But they are seeing a lot of footfall coming in and lot of these people are still have not introduced a lot of the new clinical therapies that are there in larger districts in Tier 2, Tier 3 locations.
If you look at Sahyadri today, they are at a 120-odd bed, functional beds. But if you look what they are doing, they are actually scaling up from 120 beds to 300 beds, because they are seeing a lot of opportunity. And that current 120 beds for the last five years could only give them a certain growth rate. But if you look at the new entrant in that market, which is Medicover, which is close to 225-bed, they have been able to do fairly well in that market with a decent occupancy, now they’re expanding to other clinical therapies such as mother and child, and oncology in the same space. So I think it is largely about — though, we have names there, but no one has been able to really offer the right kind of medical infrastructure. This hospital or this campus with oncology being there and the multi-specialty will in total capacity be close to 600 beds, will be the largest destination for private healthcare services in the Northern Maharashtra region.
So I think by virtue it sees almost 500 OPDs per day in the oncology space. There is a inherent footfall that comes to the hospital, the brand is well-recognized, the doctors are well-recognized. So it is going to be very easy to channelize a lot of those patients and a lot of oncology patients actually require multi-specialty care. So it will be a lot more easy to channelize those patients and lot more easy for those patients to get a holistic care of having a multi-specialty in that facility. This is broadly at a high level.
But even if you look at utilization of a stents, joints, medication, surgical material, the consumption towards — and the population and if you benchmark it to any other city in Andhra or in Telangana, Karnataka, you will see far less in number or in consumption, when you compare to this market. So, it’s not because of affordability issues, it is not because the scheme doesn’t provide good tariff or the payments are poor, it’s just that there is very little infrastructure available. And whatever infrastructure is available is already running at a certain capacity. And unless that expansion happens of infrastructure and more and more hospitals come in, and the beliefs that Nashik can treat a lot of these complex patients setting [Phonetic], only then the utilization of all of these things will go up. And this is what we’ve seen time and again in lot of the markets that we’ve entered. You might just see that the current hospitals have not been able to scale beyond a certain size, that’s because of some inherent issues, but unless more and more comes and bring in more confidence into the market, you will not see the overall push happen.
Nidhi Babaria — Dalal & Broacha Stock Broking — Analyst
Okay. Yeah, that was pretty clear. Another thing, sir, like till date more like the major portion of our expenses is always going to be doctors’ fees and doctor expenses. So if we are entering to these new markets, where, in general, the doctor retention rates are pretty high as compared to Andhra Pradesh, Telangana, how do we plan to strategize these costs?
B. Abhinay — Chief Executive Officer
No. I think it’s marginally high, it is not [Technical Issues]
Operator
Ladies and gentlemen, the line for the management has got disconnected. Request you all to please stay online, while we reconnect them. Thank you.
Ladies and gentlemen, thank you for patiently waiting. The line for the management is reconnected. Thank you. And over to you.
Vikas Maheshwari — Chief Financial Officer
Yeah, Nidhi, please go ahead.
Nidhi Babaria — Dalal & Broacha Stock Broking — Analyst
Yeah. I was talking about the doctor retention rate and how are we going to strategize those things in your market like Maharashtra?
B. Abhinay — Chief Executive Officer
We have not seen at least whatever hospitals we were allowed to see so far, we have not seen the doctor cost being significantly higher. Yes, it is marginally higher by 2%, 3%. But I think that is also — it will get adjusted because the ARPOBs are much higher than what we are seeing in AP and Telangana. So we don’t see that as the real cost challenges currently at this point in time.
Nidhi Babaria — Dalal & Broacha Stock Broking — Analyst
Okay. So in these new markets also we see likely target and — like do we think that we will be able to achieve 28%, 30% kind of EBITDA margin?
B. Abhinay — Chief Executive Officer
Yeah, I think, 25% we will certainly achieve. Wherever we have achieved 30%, it has taken time at least a 10-year timeline. So we want to get there, we will try to get there, because it’s also very difficult, right, we have not seen hospitals at a certain scale in Maharashtra yet. There are hardly one or two that operate at a scale that we are currently operating in AP and Telangana. So I think there is definitely clear path to 25%, 26%, but how we will further scale beyond that, because of the beds available, let’s say, only time will tell.
Nidhi Babaria — Dalal & Broacha Stock Broking — Analyst
Okay. And once we launched, like, we get fully operational with these new facilities in 18 months, how long do you think that we will be able to go to these EBITDA margins and what would be the rough payback period in like for these hospitals?
B. Abhinay — Chief Executive Officer
I think from the time we get operational, we are being a little pessimistic and saying we will take at least four to six years to get to that kind of EBITDA margins. But if it happens sooner then it’s good for all of us — to get your full mature EBITDA margin, because we are large format hospital, we are talking about Bangalore being close to 400 beds, we’re talking about Nashik being 325 beds.
Operator
Thank you. Ms. Babaria, may we request that you return to the question queue for follow-up questions? Thank you.
The next question is from the line of Anubhav Sahu from MC Research. Please go ahead.
Anubhav Sahu — Moneycontrol Research — Analyst
Yeah. Hi. Thanks for the opportunity. Couple of questions on the expansion plan. So, I got the point that Chennai is not top of the radar and currently you’re focused on Bangalore and Nashik. So — but still your timeline still mentioned that in next two years probably Chennai should happen. So is that the case, just wanted to confirm that?
B. Abhinay — Chief Executive Officer
So, I think, right now, yes, that looks like the case. In two, three years — two years, we’ll go back and start looking at that project. But if something more good comes up in Maharashtra and Karnataka, where we are not able to allocate capital to Tamil Nadu, then we might look at pushing out later. We are really focused on building a greenfield strategy out of Karnataka and acquisition strategy out of Maharashtra.
Anubhav Sahu — Moneycontrol Research — Analyst
Okay. Yeah, thanks for this. This Bangalore one is a greenfield, right, I mean it’s not in partnership, you are not looking for an provider there?
B. Abhinay — Chief Executive Officer
It will be in partnership with local doctors, but that will — that we still don’t have complete commitment from the local guys. We will have that when the hospital is closer to getting commissioned. But it is a mall that has been in operation for the last 10 years, which we’re now converting into a hospital.
Anubhav Sahu — Moneycontrol Research — Analyst
Okay. Okay. And the Phase 2 plans, if I put it that way for Bangalore, probably it would be again a cluster approach, going after this facility would be looking for smaller assets nearby?
B. Abhinay — Chief Executive Officer
Correct, that’s the idea. We want to have at least two, three facilities in Bangalore itself. We are exploring few opportunities in Karnataka through an acquisition route and some greenfield opportunities. So as and — but the idea is, yes, to build a cluster around Karnataka.
Anubhav Sahu — Moneycontrol Research — Analyst
Okay. Okay. That’s helpful. Yeah. Thanks a lot. Thank you for the opportunity.
Operator
Thank you. The next question is from the line of Praveen Sahay from Edelweiss Financial. Please go ahead.
Praveen Sahay — Edelweiss Financial Services — Analyst
Yeah, thank you for the follow-up. Just a clarification on Sunshine Hospital. You said about the improvement in the per month revenue and the margin to achieve in the next three years.
Vikas Maheshwari — Chief Financial Officer
That’s correct. That’s correct. This is a broader plan of three years.
Praveen Sahay — Edelweiss Financial Services — Analyst
Okay. Okay. And the second on the Sunshine only, how much is the capacity at the Secunderabad and how much is in the Gachibowli?
B. Abhinay — Chief Executive Officer
Secunderabad is around 350 beds — 325 beds, Gachibowli is around 225 beds.
Praveen Sahay — Edelweiss Financial Services — Analyst
Okay. Okay. And the third one Karimnagar also operational?
B. Abhinay — Chief Executive Officer
It’s operational, but that’s a very small facility, which is around 70 beds.
Praveen Sahay — Edelweiss Financial Services — Analyst
And out of that how much is operational, 325 beds in Secunderabad and 225 Gachibowli?
B. Abhinay — Chief Executive Officer
All beds are operational.
Praveen Sahay — Edelweiss Financial Services — Analyst
Okay. Okay. Thank you, sir. Thank you for taking my questions. Thank you.
Operator
Thank you. The next question is from the line of Bhavya Gandhi from Dalal & Broacha. Please go ahead.
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Yeah. Sir, I just wanted to understand the margin guidance, because we have Sunshine dilution, because our EBITDA margins are at lower level than Nashik. So broad level, Company level, what kind of margins are we expecting maybe for next couple of years? And what kind of inorganic revenue growth and organic growth? Because almost we’re at peak capacity now. So if you could just give a broad ballpark number with respect to margin and revenue.
B. Abhinay — Chief Executive Officer
So I think, as far as KIMS is concerned, we were able to sustain margins that we’ve seen in FY ’22. And as revenue ramp-up happens, a large part of that will flow into the EBITDA margins.
As far as Sunshine is concerned, we’ve still been able to be very healthy in the margin profile from where it was when we acquired it versus where it is currently. I think we have already been able to get to a 20% kind of a number. So as the ramp-up of revenue happens, we are looking to ramp-up the revenue almost 50% in Gachibowli and we are looking at almost another incremental 50% revenue coming in in Begumpet. So almost 50% of that is what we are expecting to flow into the EBITDA. So I think we will be pretty confident that we will be able to [Technical Issues] 26%, 27% kind of an EBITDA margin at Sunshine Hospitals as well.
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
And sir, broad level, Company level margins for next couple of years?
Vikas Maheshwari — Chief Financial Officer
So, it’s a good question, actually. So since the KIMS as on date on the [Indecipherable] 30%-plus, 32% EBITDA margin and Sunshine, which is a diluted one and it is going to be roughly 22%, 25% of total revenue. There will be some consol EBITDA margins coming down. So it should be — our guess is that, it should be between 27%, 28%, which should be at the blended level.
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Okay. And revenue growth?
Vikas Maheshwari — Chief Financial Officer
As we improve the Sunshine operations, obviously, the EBITDA and the EBITDA percentage both will go up and there is no equity dilution. So these are EPS accretive acquisitions.
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Right, right. And sir, broadly revenue growth, organic and inorganic, and the total blended growth rate?
Vikas Maheshwari — Chief Financial Officer
So, generally, we don’t give the guidance for the future, since Sunshine numbers, the acquisition numbers are in public domain, and if you just [Technical Issues] basis, we will see that roughly [Technical Issues] growth coming on the present base of the KIMS. So that will get to the revenue and whatever the organic growth comes from the existing operations, that will add to the total growth of the revenue.
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Right. And sir, my last question, what is the peak capacity for the overall business, say, for example, we are at 58% occupancy level? So at max, we can scale to what, 63%, 65% on commissioned and operationalized?
Vikas Maheshwari — Chief Financial Officer
Though, it all depends upon the case mix and the payer mix. So generally what happens that once the occupancy is at the good level, we may take more cash and insurance patient till time we increase for the more capacity. So that will also increase the revenue [Technical Issues] billing. And as the hospital matures, the profile of the case is coming to the hospital, in terms of the critical clinical patients coming, so that you will see the ARPP also going up, which you can see in the last five years and the consistently the ARPP of the patients has gone up. So you will see that and then operational excellence, how to manage beds much better. So a combination of all, so it is very difficult to say with the existing facility, how much growth can come, because it is a operational excellence, case mix and the payer mix, etc. But I think with the existing capacity, with the — definitely in the next three — two to three years as Dr. Abhinay has guided that all the existing city can be utilized fully. We can see the growth of 20%, 25% from the existing base only.
Bhavya Gandhi — Dalal & Broacha Stock Broking — Analyst
Okay. Thank you. Thank you so much. Yeah, that’s helpful.
Vikas Maheshwari — Chief Financial Officer
Thank you.
Operator
Thank you. As there are no further questions from the participants, I now hand the conference over to the management for closing comments.
B. Bhaskar Rao — Managing Director
Thank you very much, all the participants and very active discussion that happened and then we will be up to the level that what investors are expecting and whatever we have promised in the road shows and the expansion plans are going on time. Once again, thank you very much for participating.
Vikas Maheshwari — Chief Financial Officer
Thank you very much.
Operator
[Operator Closing Remarks]