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T Religare Health Trust Trustee Manager Pte. Ltd. (Registration Number: 201117555K), as trustee-manager of RHT (Trustee-Manager), is making an offering (the Offering) of 567,455,000 common units representing undivided interests in RHT (Common Units) for subscription at the offering price (Offering Price) of S$0.90 per Common Unit. The Offering consists of (i) an international placement of 555,455,000 Common Units to investors, including institutional and other investors in Singapore (Placement Tranche), and (ii) an offering of 12,000,000 Common Units to the public in Singapore (Public Offer). The total number of Units in issue as at the date of this Prospectus is 220,676,944. The total number of outstanding Units immediately after the completion of the Offering (as defi ned herein) will be 788,131,944 Units.
Standard Chartered Securities (Singapore) Pte. Limited is the sole fi nancial adviser for the Offering (the Sole Financial Adviser). Nomura Singapore Limited, Religare Capital Markets Corporate Finance Pte. Limited and Standard Chartered Securities (Singapore) Pte. Limited are the joint issue managers for the Offering (collectively the Joint Issue Managers). CIMB Securities (Singapore) Pte. Ltd., DBS Bank Ltd., Nomura Securities Singapore Pte. Ltd., Religare Capital Markets (Singapore) Pte. Limited and Standard Chartered Securities (Singapore) Pte. Limited are the joint global coordinators, bookrunners and underwriters for the Offering (collectively, the Joint Global Coordinators, Bookrunners and Underwriters or the Joint Bookrunners). Citigroup Global Markets Singapore Pte. Ltd. is the lead manager for the Offering (Lead Manager). The Offering is fully underwritten by the Joint Bookrunners on the terms and subject to the conditions of the Underwriting Agreement (as defi ned herein).
As at the date of this Prospectus, Fortis Healthcare International Limited (FHIL), a wholly-owned subsidiary of Fortis Healthcare Limited (the Sponsor), holds 220,676,943 Sponsor Units (Sponsor Units) and one Common Unit, which will be automatically converted into a Sponsor Unit on Listing.
No Units shall be allotted or allocated on the basis of this Prospectus later than six months after the registration of this Prospectus by the Monetary Authority of Singapore (Authority or MAS). Prior
to the Offering, there was no market for the Units. The offer of Common Units under this Prospectus will be by way of an initial public offering (IPO) in Singapore. Application has been made to Singapore Exchange Securities Trading Limited (SGX-ST) for permission to list for quotation on the Main Board of the SGX-ST all the Common Units (i) to be issued pursuant to the Offering, (ii) arising from the conversion of the Sponsor Units, and (iii) which may be issued to the Trustee-Manager from time to time in full or part payment of the Trustee-Managers fees. Such permission will be granted when RHT has been admitted to the Offi cial List of the SGX-ST on the Listing Date. Acceptance of applications for the Units will be conditional upon issue of the Units and upon permission being granted by the SGX-ST to list and deal in and for quotation of the Units. In the event that such permission is not granted or if the Offering is not completed for any other reason, application monies will be returned in full, at each investors own risk, without interest or any share of revenue or other benefi t arising therefrom, and without any right or claim against any of RHT, the Trustee-Manager, the Sponsor, the Sole Financial Adviser, the Joint Issue Managers, the Joint Bookrunners and the Lead Manager.
RHT has received a letter of eligibility from the SGX-ST for the listing and quotation on the Main Board of the SGX-ST of all the Common Units (i) to be issued pursuant to the Offering, (ii) arising from the conversion of the Sponsor Units and (iii) which may be issued to the Trustee-Manager from time to time in full or part payment of the Trustee-Managers fees. RHTs eligibility to list on the Main Board of the SGX-ST does not indicate the merits of the Offering, RHT, the Trustee-Manager, the Sponsor, the Sole Financial Adviser, the Joint Issue Managers, the Joint Bookrunners, the Lead Manager or the Units. The SGX-ST assumes no responsibility for the correctness of any statements or opinions made or reports contained in this Prospectus. Admission to the Offi cial List of the SGX-ST is not to be taken as an indication of the merits of the Offering, RHT, the Trustee-Manager, the Sponsor, the Sole Financial Adviser, the Joint Issue Managers, the Joint Bookrunners, the Lead Manager or the Units.
A copy of this Prospectus has been lodged on 28 September 2012 with and registered on 15 October 2012 by the MAS.
The MAS assumes no responsibility for the contents of this Prospectus. Registration of this Prospectus by the MAS does not imply that the Securities and Futures Act, Chapter 289 of Singapore (Securities and Futures Act or SFA), or any other legal or regulatory requirements, have been complied with. The MAS has not, in any way, considered the merits of the units in RHT being offered for investment.
See Risk Factors for a discussion of certain factors to be considered in connection with an investment in the Units. None of RHT, the Trustee-Manager, the Sponsor, the Sole Financial Adviser, the Joint Issue Managers, the Joint Bookrunners, or the Lead Manager guarantees the performance of RHT, the repayment of capital or the performance of or payment of a particular return on the Units.
Prospective investors applying for Common Units under the Public Offer by way of Application Forms or Electronic Applications (both as referred to in the instructions booklet entitled Terms, Conditions and Procedures for Application for and Acceptance of the Common Units in Singapore), will have to pay the Offering Price on application, subject to a refund of the full amount or, as the case may be, the balance of the application monies (in each case without interest or any share of revenue or other benefi t arising therefrom, and without any right or claim against RHT, the Trustee-Manager, the Sponsor, the Sole Financial Adviser, the Joint Issue Managers, the Joint Bookrunners and the Lead Manager), where (i) an application is rejected or accepted in part only, or (ii) if the Offering does not proceed for any reason.
The Units have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended (U.S. Securities Act), and may not be offered or sold within the United States of America (United States) except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the U.S. Securities Act. Accordingly, the Units are being offered and sold outside the United States (including to institutional and other investors in Singapore) in reliance on Regulation S under the U.S. Securities Act (Regulation S).
FIRST BUSINESS TRUST COMPRISING HEALTHCARE ASSETS IN INDIA
RELIGARE HEALTH TRUST(a business trust constituted on 29 July 2011 and registered on 25 September 2012 under the laws of the Republic of Singapore)
MANAGED BY
Religare Health Trust Trustee Manager Pte. Ltd.(an indirect wholly-owned subsidiary of Religare Enterprises Limited (REL))
Religare Health Trust (RHT) is a business trust (Registration Number: 2012006) registered under the Business Trusts Act, Chapter 31A of Singapore (Business Trusts Act or BTA).
OFFER FOR SUBSCRIPTION BYReligare Health Trust Trustee Manager Pte. Ltd.
567,455,000 Common UnitsOffering Price: $0.90 per Common Unit
* SELECTION OF PORTFOLIO ASSETS 1 ARTIST IMPRESSION
KOLKATA AMRITSAR
NOIDA BENGALURU, BG ROAD
MUMBAI, KALYAN CHENNAI, MALAR
NEW DELHI, SHALIMAR BAGH BENGALURU, NAGARBHAVI
LUDHIANA1GURGAON
FARIDABAD
JAIPUR
MUMBAI, MULUND
BENGALURU, RAJAJINAGAR
Joint Issue Managers (in alphabetical order)
Sole Financial Adviser
Joint Global Coordinators, Bookrunners and Underwriters (in alphabetical order) Lead Manager
PROSPECTUS DATED 15 OCTOBER 2012 (Registered with the Monetary Authority of Singapore on 15 October 2012)
This document is important. If you are in any doubt as to the action you should take, you should consult your legal, fi nancial, tax or other professional adviser.
EXPOSURE TO THE GROWING INDIAN HEALTHCARE SECTOR
KEY INVESTMENT HIGHLIGHTS> Exposure to the growing Indian healthcare sector
> Diversifi ed and strategically located healthcare assets
> Strong potential for organic and inorganic DPU growth
> Commitment from Sponsor with strong operating expertise
> Experienced management, board and investment advisor
> Capital structure provides fi nancing fl exibility with debt headroom for growth
GROWING ECONOMY AND RISING AFFLUENCE> Rising national income and expected increase in proportion of healthcare
expenditure> Growth in Indias upper-middle class, estimated at 60 percent of
population in 20113 and increased awareness of health-related issues likely to lead to higher healthcare-related discretionary spending in India
GROWING MARKET FOR HEALTHCARE SERVICES
RISING AND AGING POPULATION> Projected to grow 1.0 percent to 1.5 percent annually and is
expected to become the most populous nation by 20302
> Gradual increase in life expectancy will increase proportion of aged population
Notes:1 Source Frost & Sullivan (F&S). See Appendix G Independent Report on the Healthcare Industry in the Asia Pacifi c Region, Graph 2.1.2.1 prepared by the Independent Industry Consultant2 Source F&S. See Appendix G Independent Report on the Healthcare Industry in the Asia Pacifi c Region, Section 2.1.1C prepared by the Independent Industry Consultant3 Source F&S. See Appendix G Independent Report on the Healthcare Industry in the Asia Pacifi c Region, Section 2.2.1 prepared by the Independent Industry Consultant
CHANGING DISEASE PROFILE > Increase in lifestyle diseases expected to result in increase in
patient volumes and average revenue per treatment at hospitals> Predicted that India will need to develop facilities for the
diagnosis and treatment of more than 2.5 million cancer patients by 20153
15% CAGR from 2010 to 20151
(US$ Billion)
2010
59.5
2015E
119.6
2014E
104.0
2013E
90.4
2012E
78.6
2011E
68.4
INDIAN HEALTHCARE INDUSTRY MARKET SIZE
CAGR 15
.0%
INDIAS POPULATION
Lifestyle Diseases 18.5%
Others 81.5% Others 76.0%
Lifestyle Diseases 24.0%
2001 2012E
PERCENTAGE OF HOSPITALISATION CASES
2015E
1,875
2014E
1,723
2013E
1,583
2012E
1,455
2011
1,389
CAGR 7.8%
(US$)
INDIAN GDP PER CAPITA
2000
1,0104.5%
2015E
1,2565.2%
2010
1,173
5.0%
2005
1,0804.8%
=65 Years Old
(Million)
95.2% 95.0% 94.8%
This overview section is qualifi ed in its entirety by, and should be read in conjunction with, the full text of this Prospectus. Meanings of capitalised terms used may be found in the section Defi ned Terms and Abbreviations.
95.5%
> Indian healthcare sector valued at USD 59.5 billion in the year 2010, and is expected to reach USD 119.6 billion by 20156
> Out of the total Indian healthcare market in 2010, 70.0 percent to 72.0 percent comprises healthcare delivery services6
> Household expenses towards healthcare are expected to rise from 7.5 percent in 2005 to 10.0 percent in 20157
GOVERNMENT INITIATIVES TO PROMOTE THE INDIAN PRIVATE HEALTHCARE MARKET> Encouraging industry players to provide quality healthcare
through public-private partnerships, tax incentives and subsidies among other schemes
> Actively promoting the health insurance market to make private healthcare more affordable5
GROWTH IN MEDICAL TOURISM INDUSTRY> Medical tourists visiting the Asia Pacifi c region expected to
grow rapidly, increasing by 15 percent to 20 percent annually until 20154
> Indias medical tourism market expected to grow at an annual rate of more than 30% over the next three years5
> By 2015, Indias medical tourismmarket expected to be worth:
WORLD HEALTHORGANISATIONS GUIDELINE
Impliedgap of
3.7m beds
INDIA
4.0
0.9
(per 1,000 people in 2011)
UNDER-SERVED HEALTHCARE MARKET
6%India accounts for nearly of the worlds hospital beds but shares of the worlds disease burden820%
Notes:4 Source F&S. See Appendix G Independent Report on the Healthcare
Industry in the Asia Pacifi c Region, Section 1.2.4 prepared by the Independent Industry Consultant
5 Source F&S. See Appendix G Independent Report on the Healthcare Industry in the Asia Pacifi c Region, Section 2.2.1 prepared by the Independent Industry Consultant
6 Source F&S. See Appendix G Independent Report on the Healthcare Industry in the Asia Pacifi c Region, Section 2.1.2.1 prepared by the Independent Industry Consultant
7 Source F&S. See Appendix G Independent Report on the Healthcare Industry in the Asia Pacifi c Region, Section 2.1.2.2 prepared by the Independent Industry Consultant
8 Source F&S. See Appendix G Independent Report on the Healthcare Industry in the Asia Pacifi c Region, Section 2.4.3 prepared by the Independent Industry Consultant
(000)
US$2.1bn in Industry
2010
270
2015E
520
2014E
460
2013E
410
2012E
360
2011E
320
CAGR 14.0%
NUMBER OF MEDICAL TOURISTS IN INDIA
AVAILABILITY OF HOSPITAL BEDS
US$2.1BNUS$2.1BN 5
STABLE INCOME WITH STRONG POTENTIAL FOR GROWTH
To enhance the stability of distributions to Unitholders, the Trustee-Manager will enter into forward contracts to hedge up to 100% of the INR cash fl ow it expects to receive for the Forecast Year 2013 and the Projection Year 2014
> Attractive combination of stable returns through income generating assets and upside growth potential> Inorganic growth potential through third party acquisitions and right of fi rst refusal granted by the Sponsor > In-built development pipeline of clinical establishments to boost growth> Capital structure provides fi nancing fl exibility for growth opportunities
FORECAST YEAR
2013(annualised)
PROJECTION YEAR
2014
DISTRIBUTION YIELD
9.1%(1)
8.9%(1)
SIGNIFICANT ORGANIC AND INORGANIC GROWTH POTENTIAL
POTENTIAL BED CAPACITY(2)
CURRENT OPERATIONAL
BEDS (30 JUN 2012)
INSTALLED BED CAPACITY(1)
4,617
3,197
1,782
> Potential capacity expansion at existing hospitals
> Greenfi eld development opportunities within Initial Portfolio
> Sponsors expertise may help execute third-party acquisitions within India and Asia Pacifi c
> Right of fi rst refusal over Sponsors medical and healthcare infrastructure and facilities supports potential acquisition pipeline of assets
Note: (1) Installed bed capacity refers to the maximum number
of beds that can be operated at each hospital without further expansion
(2) Potential bed capacity refers to the maximum number of beds that can operate at each hospital when all planned phases of development are completed
CAPITAL STRUCTURE PROVIDES DEBT HEADROOM FOR GROWTH
MAX DEBT LEVEL
GEARING TARGET
WITH IPO DEBT(1)
WITHOUT IPO DEBT
Debt Headroom
40.0%
60.0%
6.7%
0.8%
> At IPO gearing level will be 6.7%
> Voluntarily adopted gearing limit of 60% and has a target policy of 30 40%
> 25% of the proposed capex to be funded by Sponsors refundable interest-free commitment deposit
Note: (1) Based on drawing down of S$45m SGD loan, assumes
no change to fi rm value post draw down of debt
Note: * With option to renew for 15 years on mutual agreement(1) Base Service Fee as % of total service fee; before
straight lining impact
AGREEMENTS WITH THE SPONSOR PROVIDE UPSIDE EXPOSURE WITH STABILISED RETURNS
> 15 Year Hospital and Medical Services Agreement*
> Fee structure within the Hospital and Medical Services Agreements provides RHT with stabilised returns and the opportunity to participate in the operational growth of the relevant hospitals
> Variable Service Fee: 7.5% of the Fortis Hospitals operating income
> Base Service Fee: Increases 3.0% p.a, revised upward for any capex / expansion
PROJECTION YEAR 2014
64.2
24.0
FORECAST YEAR 2013
(annualised)
63.2
21.3
74.79%(1)
72.79%(1)
Variable Service Fee
Base Service Fee
Legend
(S$ Million)
88.284.5
Note: (1) The forecast and projected results for the Forecast Year 2013 (on an annualised basis) and the Projection Year 2014 are based on the Offering Price and the various assumptions set out in this
Prospectus and is shown after including the effect of the Distribution Waiver
DIVERSIFIED AND STRATEGICALLY LOCATED HEALTHCARE ASSETS
> Large portfolio of strategically located clinical establishments and operating hospitals across India
> Trustee-Manager believes RHTs Initial Portfolio is diffi cult to replicate
> Approximately 4.1 million sq ft of built-up area across 10 cities in close proximity to local population centres and key residential districts
> Located close to major transportation nodes
INITIAL PORTFOLIO VALUED AT S$748m
11 Clinical Establishments S$714m 95.4%
4 Greenfi eld Clinical Establishments commencing operations post FY2014
S$29m 3.9%
2 Operating Hospitals S$5m 0.7%
HIGH PROPORTION OF INITIAL PORTFOLIO IS INCOME GENERATING (% of Initial Portfolio Valuation(1))
Operating Hospitals
0.7%
Clinical Establishments 95.4%
Greenfi eld Clinical Establishments
3.9%
Note: (1) Weighted by asset valuation
FOCUS ON PROVISION OF HIGH-END HEALTHCARE SERVICES (% of Initial Portfolio Valuation(1))
Quaternary32.7%
Secondary3.4%
Tertiary(2)63.8%
Notes: (1) Weighted by asset valuation(2) Includes secondary/tertiary services
400 Potential Bed Capacity Operational: 4QFY2016
Amritsar
Ludhiana
153 Operational Beds 166 Installed Bed Capacity
75 Potential Bed Capacity Operational: 2QFY2015
Faridabad
Jaipur207 Operational Beds 320 Installed Bed Capacity
210 Operational Beds 210 Installed Bed Capacity
Mumbai, Mulund
Mumbai, Kalyan
236 Operational Beds 567 Installed Bed Capacity
44 Operational Beds 52 Installed Bed Capacity
239 Operational Beds 255 Installed Bed Capacity
Bengaluru, BG Road
45 Operational Beds45 Installed Bed Capacity
31 Operational Beds31 Installed Bed Capacity
Chennai, Malar
Chennai
170 Operational Beds 178 Installed Bed Capacity
45 Potential Bed CapacityOperational: 1QFY2015
Hyderabad
Noida
Kolkata
New Delhi, Shalimar Bagh
126 Operational Beds 373 Installed Bed Capacity
191 Operational Beds 200 Installed Bed Capacity
130 Operational Beds 350 Installed Bed Capacity
Gurgaon
450 Installed Bed Capacity1,000 Potential Bed Capacity
Greater Noida350 Potential Bed Capacity Operational: 4QFY2016
: Clinical Establishments: Greenfield Clinical Establishments
: Operating Hospitals
Bengaluru, Rajajinagar
Bengaluru, Nagarbhavi
COMMITMENT FROM SPONSOR WITH STRONG OPERATING EXPERTISE > Fortis Healthcare is a leading healthcare chain in India
with an established operating track record
> Proven capability to generate strong revenue growth
> 28 percent holding in RHT
EXPERIENCED MANAGEMENT, BOARD AND INVESTMENT ADVISOR> The Trustee Managers Board and management team,
with its investment advisor, Religare Investment Advisors Limited, collectively have a range of commercial experience
> Track record of managing, sourcing and executing acquisitions of healthcare assets
ABOUTRELIGARE HEALTH TRUST RHT
The fi rst business trust with an initial portfolio comprising healthcare assets in India to be listed on the Main Board of the SGX-ST
Investment mandate is principally to invest in medical and healthcare assets and services in Asia, Australasia and emerging markets in the rest of the world. RHT may also develop
medical and healthcare assets
Initial Portfolio comprises 11 Clinical Establishments, four Greenfi eld Clinical Establishments and two Operating Hospitals located across India
ABOUT THE TRUSTEE-MANAGER RELIGARE HEALTH TRUST TRUSTEE MANAGER PTE. LTD.An indirect wholly-owned subsidiary of Religare Enterprises Limited (REL), a diversifi ed fi nancial services group listed on the National Stock Exchange of India Limited and the BSE Limited
Part of RELs multi-boutique asset management business: Religare Global Asset Management (RGAM)
RGAM had over US$13.0 billion in assets under management as at 31 March 2012
ABOUT THE SPONSOR FORTIS HEALTHCARE LIMITED, FORTISAn integrated healthcare delivery provider in the Pan Asia-Pacifi c region with an operating record in excess of 10 years
Current network comprises 73 healthcare delivery facilities spanning 10 countries across the Asia Pacifi c region, including India, Singapore, Australia, New Zealand and Vietnam
Incorporated in India and listed on the National Stock Exchange of India Limited and the BSE Limited
APPLICATIONS FOR THE PUBLIC OFFER MAY BE MADE THROUGH:
ATM AND INTERNET BANKING WEBSITES OF DBS BANK (INCLUDING POSB), OCBC AND UOB (AND ITS SUBSIDIARY FAR EASTERN BANK LIMITED) AND THE MOBILE BANKING PLATFORM OF DBS BANK, OR
PRINTED WHITE APPLICATION FORMS WHICH FORM PART OF THE PROSPECTUS
HOW TO APPLY
OFFER TIMETABLEPLEASE SEE SUMMARY INDICATIVE TIMETABLE FOR MORE INFORMATION
CONTENTS
NOTICE TO INVESTORS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iii
FORWARD-LOOKING STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . v
CERTAIN DEFINED TERMS AND CONVENTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . vii
MARKET AND INDUSTRY INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ix
CORPORATE INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . x
SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
INFORMATION CONCERNING THE UNITS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
DILUTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
DISTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
EXCHANGE RATE INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
CAPITALISATION AND INDEBTEDNESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET AS AT 31 MARCH 2012. 93
PROFIT FORECAST AND PROFIT PROJECTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
STRATEGY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119
BUSINESS AND PORTFOLIO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122
THE TRUSTEE-MANAGER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 185
THE SPONSOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 211
CORPORATE GOVERNANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 213
INTERESTED PERSON TRANSACTIONS AND POTENTIAL CONFLICTS OF INTEREST . . 222
THE FORMATION AND STRUCTURE OF RHT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 257
CERTAIN AGREEMENTS RELATING TO RHT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 268
OVERVIEW OF RELEVANT LAWS AND REGULATIONS IN INDIA . . . . . . . . . . . . . . . . . . . 314
TAXATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 319
PLAN OF DISTRIBUTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 326
i
CLEARANCE AND SETTLEMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 334
EXPERTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 336
REPORTING AUDITOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 337
INDEPENDENT TAX ADVISER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 338
GENERAL AND STATUTORY INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 339
DEFINED TERMS AND ABBREVIATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 359
APPENDIX A REPORTING AUDITORS REPORT ON THE EXAMINATION OF THE
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET AS AT
31 MARCH 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1
APPENDIX B REPORTING AUDITORS REPORT ON THE PROFIT FORECAST AND
PROFIT PROJECTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1
APPENDIX C INDEPENDENT TAXATION REPORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . C-1
APPENDIX D INDEPENDENT VALUATION SUMMARY REPORT . . . . . . . . . . . . . . . . . D-1
APPENDIX E INDEPENDENT ENTERPRISE VALUATION SUMMARY REPORT . . . . . . E-1
APPENDIX F INDEPENDENT DISCOUNTED FREE CASH FLOW VALUATION OF
EHIRCL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-1
APPENDIX G INDEPENDENT REPORT ON THE HEALTHCARE INDUSTRY IN THE
ASIA PACIFIC REGION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . G-1
APPENDIX H LIST OF PRESENT AND PAST PRINCIPAL DIRECTORSHIPS OF
DIRECTORS AND EXECUTIVE OFFICERS . . . . . . . . . . . . . . . . . . . . . . . H-1
ii
NOTICE TO INVESTORS
No person is authorised to give any information or to make any representation in connection with
the Offering not contained in this Prospectus and any information or representation not so
contained must not be relied upon as having been authorised by or on behalf of any of RHT, the
Trustee-Manager, the Sponsor, the Sole Financial Adviser, the Joint Issue Managers, the Joint
Bookrunners or the Lead Manager. If anyone provides you with different or inconsistent
information, you should not rely upon it. Neither the delivery of this Prospectus nor any offer,
subscription, sale or transfer made hereunder shall under any circumstances imply that the
information herein is correct as at any date subsequent to the date hereof or constitute a
representation that there has been no change or development reasonably likely to involve a
material adverse change in the affairs, conditions and prospects of RHT, the Trustee-Manager or
the Common Units since the date of this Prospectus. Where such changes occur and are material
or required to be disclosed by law, the SGX-ST and/or any other regulatory or supervisory body
or agency, the Trustee-Manager will make an announcement of the same to the SGX-ST and, if
required, issue and lodge an amendment to this Prospectus or a supplementary document or
replacement document pursuant to Section 282C or 282D of the SFA and take immediate steps
to comply with these sections. Investors should take notice of such announcements and
documents and upon release of such announcements and documents shall be deemed to have
notice of such changes.
None of RHT, the Trustee-Manager, the Sponsor, the Sole Financial Adviser, the Joint Issue
Managers, the Joint Bookrunners or the Lead Manager or any of their respective affiliates,
directors, officers, employees, agents, representatives or advisers is making any representation
or undertaking to any subscriber of Common Units regarding the legality of an investment by such
subscriber under any legal, investment or similar laws. In addition, this Prospectus is issued solely
for the purpose of the Offering and prospective investors in the Common Units should not construe
the contents of this Prospectus as legal, business, financial or tax advice. Investors should be
aware that they may be required to bear the financial risks of an investment in the Common Units
for an indefinite period of time. Investors should consult their own professional advisers as to the
legal, business, financial or tax and related aspects of an investment in the Common Units.
By applying for the Common Units on the terms and subject to the conditions in this Prospectus,
each investor in the Common Units represents and warrants that, except as otherwise disclosed
to the Trustee-Manager, the Sole Financial Adviser, the Joint Issue Managers, Joint Bookrunners
or the Lead Manager in writing, he is not (i) a Director or substantial shareholder/Unitholder (as
the case may be) of RHT, the Trustee-Manager or the Sponsor, (ii) an associate of any of the
persons mentioned in (i), or (iii) a connected client of any of the Sole Financial Adviser, the Joint
Issue Managers, Joint Bookrunners or the Lead Manager or lead broker or distributor of the
Common Units.
iii
Copies of this Prospectus and the Application Forms may be obtained on request, subject to
availability, during office hours, from:
CIMB Securities (Singapore)
Pte. Ltd.
DBS Bank Ltd. Nomura Securities Singapore
Pte. Ltd.
50 Raffles Place
CIMB Investment Centre
#01-01, Singapore Land Tower
Singapore 048623
12 Marina Boulevard
Level 46
DBS Asia Central
@ Marina Bay Financial Centre
Tower 3
Singapore 018982
10 Marina Boulevard
#36-01, Marina Bay Financial
Centre Tower 2
Singapore 018983
Religare Capital Markets (Singapore)
Pte. Limited
Standard Chartered Securities (Singapore)
Pte. Limited
80 Raffles Place
43rd Floor UOB Plaza 1
Singapore 048624
8 Marina Boulevard
Level 19, Marina Bay Financial Centre
Tower 1
Singapore 018981
and, where applicable, from members of the Association of Banks in Singapore, members of the
SGX-ST and merchant banks in Singapore. A copy of this Prospectus is also available on the
SGX-ST website: .
The distribution of this Prospectus and the offering, subscription, sale or transfer of the Common
Units in certain jurisdictions may be restricted by law. RHT, the Trustee-Manager, the Sponsor, the
Sole Financial Adviser, the Joint Issue Managers, the Joint Bookrunners and the Lead Manager
require persons into whose possession this Prospectus comes, to inform themselves about and
to observe any such restrictions at their own expense and without liability to any of RHT, the
Trustee-Manager, the Sponsor, the Sole Financial Adviser, the Joint Issue Managers, the Joint
Bookrunners and the Lead Manager. This Prospectus does not constitute, and the Trustee-
Manager, the Sponsor, the Sole Financial Adviser, the Joint Issue Managers, the Joint
Bookrunners and the Lead Manager are not making, an offer of, or an invitation to subscribe for
or purchase, any of the Common Units in any jurisdiction in which such offer or invitation would
be unlawful. Persons to whom a copy of this Prospectus has been issued must not circulate to any
other person, reproduce or otherwise distribute this Prospectus or any information herein for any
purpose whatsoever nor permit or cause the same to occur.
The Common Units have not been, and will not be, registered under the U.S. Securities Act or any
United States state securities laws. Unless so registered, the Common Units may not be offered
or sold within the United States except pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the U.S. Securities Act and applicable United States
state securities laws. The Common Units are being offered or sold outside the United States in
reliance on Regulation S. Each purchaser of the Common Units hereby in making its purchase will
be required to make or will be deemed to have made certain acknowledgements, representations
and agreements. There will be no public offering of the Common Units in the United States.
The total number of Common Units in issue immediately after the completion of the Offering will
be 567,455,000 Common Units.
iv
FORWARD-LOOKING STATEMENTS
Certain statements in this Prospectus constitute forward-looking statements. All statementsother than statements of historical facts included in this Prospectus, including those regardingfuture financial position and results, business strategy, plans and objectives of management forfuture operations (including development plans and dividends) and statements on future industrygrowth are forward-looking statements. This Prospectus also contains forward-looking financialinformation in Profit Forecast and Profit Projection. These forward-looking statements andfinancial information involve known and unknown risks, uncertainties and other factors that maycause the actual results, performance or achievements of RHT, the Trustee-Manager or theSponsor, or industry results, to be materially different from any future results, performance orachievements expressed or implied by these forward-looking statements and financialinformation. These forward-looking statements and financial information are based on numerousassumptions regarding the Trustee-Managers present and future business strategies and theenvironment in which RHT, the Trustee-Manager and the Sponsor will operate in the future.Because these statements and financial information reflect the Trustee-Managers current viewsconcerning future events, these statements and financial information necessarily involve risks,uncertainties and assumptions. Actual future performance could differ materially from theseforward-looking statements and financial information. You should not place any undue reliance onthese forward-looking statements.
The important factors that could cause RHTs actual results, performance or achievements todiffer materially from those in the forward-looking statements and financial information include, butare not limited to:
RHTs dependence on the Sponsor as a hospital operator;
legal uncertainties and defects as to title over land;
the ability of the Hospital Services Companies to obtain all necessary licences, permits andapprovals;
RHT successfully completing the development of the medical and healthcare infrastructureand facilities under development or to be developed;
increasing competition in the industry in Asia, Australasia and other markets in which theRHT Group operates or may operate;
compliance with safety, health, environmental and other regulations in India or elsewhere;
general global, regional and local political, economic and social conditions, in India orelsewhere;
regulatory developments and changes in the healthcare market industry in which RHToperates in India or elsewhere;
changes in government regulations and policies, including tax or licensing laws, in thejurisdictions where RHT operates now or in the future;
the ability of the Trustee-Manager to successfully execute the business strategies andinvestment mandate of RHT;
changes in the need for capital and the availability of financing and capital to fund theseneeds;
the loss of key personnel of the Trustee-Manager or in the entities in the RHT Group and theinability to replace such personnel on a timely basis or on terms acceptable to theTrustee-Manager or RHT;
v
foreign currency exchange rate fluctuations, including fluctuations in the exchange rates of
currencies that are used in the business of RHT such as the Singapore dollar and the Indian
Rupee;
general volatility of the capital markets;
other factors beyond the control of RHT; and
other matters not yet known to RHT.
Additional factors that could cause actual results, performance or achievements to differ
materially include, but are not limited to, those discussed under Risk Factors, Profit Forecast
and Profit Projection, Distributions, and Business and Portfolio. These forward-looking
statements and financial information speak only as at the date of this Prospectus. The
Trustee-Manager expressly disclaims any obligation or undertaking to release publicly any
updates of or revisions to any forward-looking statement or financial information contained herein
to reflect any change in the Trustee-Managers expectations with regard thereto or any change in
events, conditions or circumstances on which any such statement or information is based, subject
to compliance with all applicable laws and regulations and/or the rules of the SGX-ST and/or any
other relevant regulatory or supervisory body or agency.
vi
CERTAIN DEFINED TERMS AND CONVENTIONS
RHT will publish its financial statements in Singapore dollars. In this Prospectus, references to
S$ or Singapore dollars and Singapore cents are to the lawful currency of the Republic of
Singapore, references to `, Rupees, INR or Indian Rupees are to the lawful currency of the
Republic of India, references to US$, USD or US dollars are to the lawful currency of the
United States of America and references to MUR or Mauritian Rupees are to the lawful
currency of the Republic of Mauritius. For the readers convenience, except where the exchange
rate between the Indian Rupee and the Singapore dollar is expressly stated otherwise, certain
Indian Rupee amounts in this Prospectus have been translated into Singapore dollars based on
the fixed exchange rate of `43.552 = S$1.001 which is the 18 October 2012 forward rate as at 21
September 2012. However such translations should not be construed as representations that
Indian Rupee amounts have been, could have been or could be converted into Singapore dollars
at that or any other rate (see Exchange Rate Information).
Capitalised terms used in this Prospectus shall have the meanings set out in the Defined Terms
and Abbreviations.
The forecast and projected yields and yield growth are calculated based on the Offering Price and
the assumption that the Listing Date is 1 October 2012. Such forecast and projected yields and
yield growth will vary accordingly, given the Listing Date will be after 1 October 2012, or for
investors who purchase Common Units in the secondary market at a market price different from
the Offering Price.
Any discrepancies in the tables, graphs and charts included in this Prospectus between the listed
amounts and totals thereof are due to rounding. Save in the case of ` and S$ which are rounded
to the nearest thousand and percentages which are rounded to one decimal place, where
applicable, figures are rounded to the nearest whole number. Measurements in square metres
(sq m) are converted to sq ft and vice versa based on the conversion rate of 1.0 sq m = 10.7639
sq ft. Measurements in acres are converted to sq ft and vice versa based on the conversion rate
of 1.0 acre = 43,560 sq ft.
References to Appendix or Appendices are to the appendices set out in this Prospectus. All
references in this Prospectus to dates and times shall mean Singapore dates and times unless
otherwise specified.
1 Source: Bloomberg L.P.. Bloomberg L.P. has not provided its consent, for purposes of Section 282I of the
SFA, to the inclusion of the information extracted from the relevant report published by it and therefore is not
liable for such information under Sections 282N and 282O of the SFA. While the Trustee-Manager, the Sole
Financial Adviser, the Joint Issue Managers, the Joint Bookrunners and the Lead Manager have taken
reasonable actions to ensure that the information from the relevant report published by Bloomberg L.P. is
reproduced in its proper form and context, and that the information is extracted accurately and fairly from
such report, neither the Trustee-Manager, the Sole Financial Adviser, the Joint Issue Managers, the Joint
Bookrunners and the Lead Manager nor any other party has conducted an independent review of the
information contained in such report nor verified the accuracy of the contents of the relevant information.
vii
References herein to India are to the Republic of India.
References herein to the Singapore Companies Act are to the Companies Act, Chapter 50 of
Singapore. References herein to the Indian Companies Act are to The (Indian) Companies Act
1956, as amended.
References herein to the Latest Practicable Date are to 18 September 2012, which is the latest
practicable date prior to the lodgement of this Prospectus with the Authority.
viii
MARKET AND INDUSTRY INFORMATION
This Prospectus includes market and industry data and forecasts that have been obtained from
internal surveys, reports and studies, where appropriate, as well as market research, publicly
available information and industry publications. The Trustee-Manager has commissioned Frost
and Sullivan India Private Limited to prepare the Independent Report on the Healthcare Industry
in the Asia Pacific Region (see Appendix G Independent Report on the Healthcare Industry in
the Asia Pacific Region). The purpose of the report is to provide an independent overview on the
healthcare industry in India and other selected countries in the Asia Pacific region. Industry
publications, surveys and forecasts generally state that the information they contain has been
obtained from sources believed to be reliable, but there can be no assurance as to the accuracy
or completeness of such information. While the Trustee-Manager has taken reasonable steps to
ensure that the information is extracted accurately and in its proper context, the Trustee-Manager
has not independently verified any of the data from third party sources or ascertained the
underlying economic assumptions relied upon therein. Consequently, none of RHT, the Trustee-
Manager, the Sponsor, the Sole Financial Adviser, the Joint Issue Managers, the Joint
Bookrunners or the Lead Manager makes any representation as to the accuracy of completeness
of such information, and each of them shall not be held responsible in respect of any such
information and shall not be obliged to provide any updates on the same.
The Trustee-Manager has appointed Cushman & Wakefield VHS Pte. Ltd. as the valuer for the
Initial Portfolio (as defined herein) (the Independent Valuer) (see Appendix D Independent
Valuation Summary Report). The Trustee-Manager has appointed Grant Thornton Corporate
Finance Pte. Ltd. as the second valuer for the Initial Portfolio (the Independent Enterprise
Valuer) (see Appendix E Independent Enterprise Valuation Summary Report). The Trustee-
Manager and Kanishka Healthcare Limited have appointed Corporate Professionals Capital
Private Limited as the valuer for the equity shares of Escorts Heart Institute and Research Centre
Limited (the Independent EHIRCL Valuer) (see Appendix F Independent Discounted Free
Cash Flow Valuation of EHIRCL).
ix
CORPORATE INFORMATION
Trustee-Manager of RHT
Registered Office
Religare Health Trust Trustee Manager Pte. Ltd.
9 Battery Road
#15-01 Straits Trading Building
Singapore 049910
Principal Place of Business 80 Raffles Place
#11-20 UOB Plaza 2
Singapore 048624
Sole Financial Adviser Standard Chartered Securities (Singapore) Pte.
Limited
8 Marina Boulevard
Level 19, Marina Bay Financial Centre Tower 1
Singapore 018981
Joint Issue Managers
(in alphabetical order)
Nomura Singapore Limited
10 Marina Boulevard
#36-01, Marina Bay Financial Centre Tower 2
Singapore 018983
Religare Capital Markets Corporate Finance Pte.
Limited
80 Raffles Place
43rd Floor UOB Plaza 1
Singapore 048624
Standard Chartered Securities (Singapore) Pte.
Limited
8 Marina Boulevard
Level 19, Marina Bay Financial Centre Tower 1
Singapore 018981
Joint Global Coordinators,
Bookrunners and Underwriters
(in alphabetical order)
CIMB Securities (Singapore) Pte. Ltd.
50 Raffles Place
#19-00 Singapore Land Tower
Singapore 048623
DBS Bank Ltd.
12 Marina Boulevard
Level 46 DBS Asia Central
@ Marina Bay Financial Centre Tower 3
Singapore 018982
Nomura Securities Singapore Pte. Ltd.
10 Marina Boulevard
#36-01, Marina Bay Financial Centre Tower 2
Singapore 018983
Religare Capital Markets (Singapore) Pte. Limited
80 Raffles Place
43rd Floor UOB Plaza 1
Singapore 048624
x
Standard Chartered Securities (Singapore) Pte.
Limited
8 Marina Boulevard
Level 19, Marina Bay Financial Centre Tower 1
Singapore 018981
Lead Manager Citigroup Global Markets Singapore Pte. Ltd.
8 Marina View
#21-00 Asia Square Tower 1
Singapore 018960
Coordinator of the Public Offer CIMB Securities (Singapore) Pte. Ltd.
50 Raffles Place
#19-00 Singapore Land Tower
Singapore 048623
Legal Adviser to the Offering,
and to the Trustee-Manager and
the Sponsor as to Singapore Law
Rajah & Tann LLP
9 Battery Road
#25-01 Straits Trading Building
Singapore 049910
Legal Adviser to the
Trustee-Manager and
the Sponsor as to Indian Law
Amarchand & Mangaldas & Suresh A. Shroff & Co.
Peninsula Chambers
Peninsula Corporate Park
Ganpatrao Kadam Marg
Lower Parel, Mumbai 400 013
India
Legal Adviser to the Trustee-
Manager as to Property Title to
the Initial Portfolio under
Indian Law
Vaish Associates Advocates
106, Peninsula Centre
Dr. S. S. Rao Road
Parel, Mumbai 400 012
India
Legal Adviser to the Joint Issue
Managers, the Joint Global
Coordinators, Bookrunners and
Underwriters and the Lead Manager
as to Singapore Law
Allen & Gledhill LLP
One Marina Boulevard #28-00
Singapore 018989
Legal Adviser to the Joint Issue
Managers, the Joint Global
Coordinators, Bookrunners and
Underwriters and the Lead Manager
as to US Federal Securities Law
Linklaters Singapore Pte. Ltd.
One George Street #17-01
Singapore 049145
Legal Adviser to the Joint Issue
Managers, the Joint Global
Coordinators, Bookrunners and
Underwriters and the Lead Manager
as to Indian Law
Luthra & Luthra Law Offices
103, Ashoka Estate
Barakhamba Road
New Delhi 110 001
India
Reporting Auditor Ernst and Young LLP
One Raffles Quay
North Tower, Level 18
Singapore 048583
xi
Independent Tax Adviser PricewaterhouseCoopers Services LLP
8 Cross Street
#17-00 PWC Building
Singapore 048424
Independent Valuer Cushman & Wakefield VHS Pte. Ltd.
3 Church Street
#09-03 Samsung Hub
Singapore 049483
Independent Enterprise Valuer Grant Thornton Corporate Finance Pte. Ltd.
47 Hill Street
#05-01 Singapore Chinese Chamber of
Commerce & Industry Building
Singapore 179365
Independent EHIRCL Valuer Corporate Professionals Capital Private Limited
D-28, South Extension Part-1,
New Delhi 110 049
India
Independent Industry Consultant Frost and Sullivan India Private Limited
101, Prestige Loka Building, First Floor
7/1, Brunton Road, Bangalore
Karnataka India
Principal Bankers Standard Chartered Bank
8 Marina Boulevard Level 25
Marina Bay Financial Centre Tower 1
Singapore 018981
Citigroup Global Markets Singapore Pte. Ltd.
8 Marina View
#21-00 Asia Square Tower 1
Singapore 018960
DBS Bank Ltd.
12 Marina Boulevard
Level 46 DBS Asia Central
@ Marina Bay Financial Centre Tower 3
Singapore 018982
Receiving Bank Citibank NA, Singapore Branch
8 Marina View
#21-00 Asia Square Tower 1
Singapore 018960
Unit Registrar and
Unit Transfer Office
Boardroom Corporate & Advisory Services Pte. Ltd.
50 Raffles Place
#32-01 Singapore Land Tower
Singapore 048623
xii
SUMMARY
The following summary is qualified in its entirety by, and is subject to, the more detailed
information contained in or referred to elsewhere in this Prospectus. The meanings of terms not
defined in this overview can be found in Defined Terms and Abbreviations or in the trust deed
of RHT (Trust Deed). A copy of the Trust Deed can be inspected at the registered office of the
Trustee-Manager, which is located at 9 Battery Road, #15-01 Straits Trading Building, Singapore
049910.
Statements contained in this summary that are not historical facts may be forward-looking
statements. Such statements are based on certain assumptions and are subject to certain risks,
uncertainties and assumptions that could cause actual results of RHT to differ materially from
those forecasted or projected in this Prospectus (see Forward-Looking Statements). Under no
circumstances should the inclusion of such information herein be regarded as a representation,
warranty or prediction of the accuracy of the underlying assumptions by RHT, the Trustee-
Manager, the Sponsor, the Sole Financial Adviser, the Joint Issue Managers, the Joint
Bookrunners or the Lead Manager or any other person or that these results will be achieved or are
likely to be achieved. Investing in the Units involves risks. Prospective investors are advised not
to rely solely on this summary, but should read this Prospectus in its entirety and, in particular, the
sections of this Prospectus from which the information in this summary is extracted and Risk
Factors to better understand the Offering and RHTs businesses and risks.
OVERVIEW OF RHT
RHT is the first business trust with an initial portfolio comprising healthcare assets in India to be
listed on the Main Board of the SGX-ST.
RHTs investment mandate is principally to invest in medical and healthcare assets and services
in Asia, Australasia and emerging markets in the rest of the world. RHT may also develop medical
and healthcare assets. It is expected that the medical services will be provided directly by RHT
or in collaboration with third parties. Whilst the Trustee-Manager currently has no intention of
owning and fully operating and managing hospitals other than the Operating Hospitals (as defined
herein), if RHT in the future wishes to own and fully operate and manage hospitals other than the
Operating Hospitals, the Trustee-Manager will obtain Unitholders approval prior to undertaking
such an investment (see Business and Portfolio Overview Key Information on the Initial
Portfolio for more information).
The Trustee-Managers key objective is to provide Unitholders with an attractive rate of return for
their investment through stable and regular distributions to Unitholders and to achieve long term
growth in distributions and net asset value (NAV).
RHTs initial portfolio comprises 11 clinical establishments held by RHT (RHT Clinical
Establishments), four clinical establishments to be developed (Greenfield Clinical
Establishments) and two hospitals managed and operated by RHT (Operating Hospitals)
located across India (Initial Portfolio), with an aggregate value of `32,577 million (S$748.0
million), based on the valuation by the Independent Valuer.1 The Independent Enterprise Valuer
has valued the Initial Portfolio of RHT at between `33,000 million (S$757.7 million) and `34,000
million (S$780.7 million).2
1 The Initial Portfolio was valued by Cushman & Wakefield VHS Pte. Ltd. as at 30 June 2012. See Appendix
D Independent Valuation Summary Report. In addition, please refer to Summary Initial Portfolio for
the valuation of each asset comprised in the Initial Portfolio.
2 The Initial Portfolio was valued by Grant Thornton Corporate Finance Pte. Ltd. as at 31 August 2012. See
Appendix E Independent Enterprise Valuation Summary Report.
1
There are operational hospitals providing secondary, tertiary and quaternary healthcare services
to patients, in various specialised fields, including cardiac sciences, neurosciences, orthopaedics,
renal sciences, gastroenterology and oncology at 10 of the 11 RHT Clinical Establishments
(Fortis Hospitals). Trial runs have commenced for the RHT Clinical Establishment located in
Gurgaon (Gurgaon Clinical Establishment) and it will be operated as a multi-specialty tertiary
hospital offering various specialised fields including trauma, paediatrics, oncology, cardiac
sciences, gynaecology and orthopaedics. The Hospital and Medical Services Agreement in
respect of the Gurgaon Clinical Establishment took effect on 1 August 2012. The Greenfield
Clinical Establishments are located in Chennai, Ludhiana, Hyderabad and Greater Noida.
Pursuant to the Hospital and Medical Services Agreements, the Hospital Services Companies will
provide Clinical Establishment Services1 (as defined herein) at the RHT Clinical Establishments,
for and behalf of the Fortis Operating Companies, who will run the Fortis Hospitals for providing
healthcare services to the patients, at the relevant RHT Clinical Establishments.
RHT, through its subsidiaries FHML and KHL, also holds the Operating Hospitals providing
secondary healthcare in Bengaluru, Nagarbhavi and Bengaluru, Rajajinagar, the land and building
of which are leased/sub-leased to FHML and KHL respectively. The two Operating Hospitals are
operated and managed by FHML and KHL.
The implied cost of the Initial Portfolio is `31,327 million (S$719.3 million), based on the Offering
Price after taking into account the Sponsors Unitholdings after the Offering.
RHT will, within three business days of the Listing Date, through its wholly-owned subsidiary, KHL,
complete its subscription for compulsorily convertible preference shares (CCPS) in Escorts
Heart Institute and Research Centre Limited (EHIRCL) for an aggregate amount of `3,000 million
(S$68.9 million)(CCPS Subscription). The aggregate amount of `3,000 million (S$68.9 million)
is included in the `31,327 million (S$719.3 million) implied cost of the Initial Portfolio.
RHT is sponsored by Fortis Healthcare Limited (Fortis or the Sponsor), an integrated
healthcare delivery provider in the Pan Asia-Pacific region. RHT is managed by Religare Health
Trust Trustee Manager Pte. Ltd. (the Trustee-Manager), which is part of the Religare Group, a
diversified financial services group.
1 (i) providing specific out-patient and day care medical and healthcare services and radiology and imaging
diagnostic services to patients at the Fortis Hospital, for and on behalf of the Fortis Operating Company, (ii)
maintaining and operating a RHT Clinical Establishment to allow the Fortis Operating Company to run a Fortis
Hospital for providing healthcare services to patients, and (iii) establishing and setting up and providing
services and facilities which are ancillary to the operation and management of a hospital.
2
KEY INVESTMENT HIGHLIGHTS
The Trustee-Manager believes that an investment in RHT offers the following attractions to
Unitholders:
(A) Exposure to the Indian Healthcare Sector Growing Market for Healthcare Services
The private healthcare sector outlook in India is positive due to the following reasons:
(1) Large and Growing Population and Changing Demographics
India is the second most populous country in the world with a population of 1.2 billion
(approximately 17.3% of the worlds population) in 2011.1 Indias population is projected
to grow by 1.0% to 1.5% annually going forward and is expected to surpass the Peoples
Republic of China as the worlds most populous nation by 2030.1
In addition, due to the gradual increase in life expectancy, Frost and Sullivan India
Private Limited, the independent industry consultant (F&S or the Independent
Industry Consultant) has projected the proportion of aged population (defined as
population aged 65 years and above) in India to increase from 5.0% in 2010
(approximately 58.1 million people) to 5.2% (approximately 65.0 million people) in
2015.1
This large and growing population would provide a sizable base demand for healthcare
services in India. The ageing population would also increase the expected growth in
demand for healthcare services in India.
(2) Growing Economy and Rising Affluence in India
India recorded a GDP growth of 4.8% in 2011 and its GDP is estimated to grow at a
compound annual growth rate (CAGR) of 9.2% from US$1.7 trillion in 2011 to US$2.4
trillion in 2015.1 Indias GDP per capita is also projected to increase at a CAGR of 7.8%
over the same period from US$1,389 in 2011 to US$1,875 in 2015.1 The rising national
income, coupled with an expected increase in the proportion of healthcare expenditure
relative to other household expenditures from 7.5% in 2005 to 10.0% in 20152 is
expected to translate into higher healthcare spending in India.
Further, the growing economy is driving expansion in the upper middle class segment
(defined as households with an annual income of between US$2,500 and US$13,000)
which is now estimated to account for nearly 60.0% of the Indian population in 2011,
compared to approximately 50.0% of the Indian population in 2007.3 This growth in the
upper middle class segment as well as an increased awareness of health-related issues
is likely to lead to an increase in healthcare-related discretionary expenditure.
1 See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific Region, Section 2.1.1
prepared by the Independent Industry Consultant.
2 See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific Region, Section 2.1.2
prepared by the Independent Industry Consultant.
3 See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific Region, Section 2.2.1
prepared by the Independent Industry Consultant.
3
Indian GDP Forecast (US$ billion)
2011 2015E
Indian Household Expenditure Overview
2005 2015E
1,6761,779
1,9622,164
2,385
2011 2012E 2013E 2014E 2015E
6.8% 5.2%
32.0%
6.5%
5.5%
13.0%
13.0%
9.5%
14.0%19.0%
4.7% 5.8%
40.0%
7.5%
10.0%7.5%
E51025002
Others Food, Beverages & Tobacco
Apparel Housing and Utilities
Personal Products Service Transportation
Education & Recreation Healthcare
Source: F&S. See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific
Region, Sections 2.1.1B and 2.1.2.2 prepared by the Independent Industry Consultant.
The Trustee-Manager therefore believes that the growing Indian economy will support
a sustained growth in healthcare demand and in particular, demand for healthcare
services offered by the private sector in secondary, tertiary and quaternary healthcare
services.
(3) Increasing Incidence of Non-Communicable Diseases in India
Non-communicable diseases (NCDs) such as coronary heart diseases, cancer and
diabetes have become a leading cause of death, morbidity and disability in the Asia
Pacific region.1 Some of the key factors contributing to the increase in these chronic
diseases include changing demographics, unhealthy diet, physical inactivity and
increasing intake of tobacco and alcohol.1 In India, the incidence of coronary heart
diseases, cancer and diabetes is expected to affect 62.0 million people (4.9% of the
population), 2.5 million people (0.2% of the population) and 46.0 million people (3.7%
of the population) respectively in 2015, compared to 36.0 million people (3.3% of the
population), 2.0 million (0.2% of the population) and 31.0 million people (2.8% of the
population) affected respectively in 2005.2
Breakdown of Hospitalisation Cases by Specialty Diseases in India
(Percentage of Hospitalisation Cases)
Acute Diseases
54.7%
9.0% 5.0% 2.0%9.8%3.0%
2.8%3.9%4.0%5.1% 0.7%
11.2%
6.0% 5.0%7.4%
42.0%
13.0%
2.0%1.7% 2.2% 1.7%7.8%
Acute
Infe
ctio
ns
Ort
hopedic
s
and
Rheum
ato
logy
Ear,
Nose
Thro
at, E
ye
and S
kin
Asth
ma
Oth
er
Circula
tory
Dis
eases
Heart
Dis
eases
Centr
al
Nerv
ous
Syste
m
Dis
ord
ers
Dia
bete
s
Cancer
Accid
ents
&
Em
erg
encie
s
Oth
ers
2001 2012E
Non-Communicable Diseases srehtO
Source: F&S. See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific
Region, Section 2.1.1C prepared by the Independent Industry Consultant.
1 In selected countries as listed in the report by the Independent Industry Consultant. See Appendix G
Independent Report on the Healthcare Industry in the Asia Pacific Region, Section 1.2.2 prepared by the
Independent Industry Consultant.
2 See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific Region, Section 2.1.1
prepared by the Independent Industry Consultant.
4
In addition to the projected growth in patient volumes, a higher incidence of NCDs
would also result in an increase in the average revenue per treatment at hospitals as
costs of treatment of NCDs are typically higher relative to treatment of communicable
diseases.1 The Trustee-Manager therefore believes that the increasing incidence of
NCDs will be a key factor in driving healthcare expenditure in India.
(4) Increasing Affordability of Healthcare Services in India
The health insurance market is one of the fastest growing segments in Indias general
insurance industry.1 As of 2010, approximately 240 million to 250 million people in the
country (20.5% to 21.3% of the population) were covered by insurance and other forms
of health protection, which pays for nearly 10.0% of all hospitalisation expenditure in the
country.1 The Independent Industry Consultant expects that the Indian health insurance
market will continue to expand, with an increase in insurance coverage, and has
projected that total insurance premiums paid will increase at a CAGR of 27.0% from
US$1,844 million in 2010 to US$6,081 million in 2015.1
Indian Health Insurance Market (Total Insurance Premiums)
(US$ million)
1,8442,360
3,021
3,867
4,865
6,081
2010 2011E 2012E 2013E 2014E 2015E
CAGR of 27.0%
Source: F&S. See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific
Region, Section 2.2.1.4 prepared by the Independent Industry Consultant.
The increasing prevalence of health insurance is expected to make quality healthcare
services provided by private hospitals (including chains of hospitals run by professional
healthcare groups (corporate hospitals)) in India more affordable and boost
healthcare expenditures per household.2 Currently, health insurance accounts for
25.0% to 30.0% of the total revenue for corporate hospitals in Tier I Cities.1 With the
increasing awareness of insurance with extended coverage across various healthcare
services including dental care and outpatient surgery, it is estimated that health
insurance is likely to account for nearly 40.0% of corporate hospital revenues by 2015.1
1 See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific Region, Section 2.2.1
prepared by the Independent Industry Consultant.
2 See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific Region, Section 2.2.1
prepared by the Independent Industry Consultant.
5
(5) Growth in Medical Tourism Industry in Asia Pacific including India
It is expected that the medical tourism industry in the Asia Pacific region will grow
rapidly, with the number of medical tourists visiting the Asia Pacific region to increase
by approximately 15.0% to 20.0% annually to 2015 due to various factors1 , including,
but not limited to:
increasing adoption of sophisticated medical technology;
rising affluence of the middle income class population seeking quality medical
care;
availability of skilled doctors and para-medical staff;
increasing willingness of patients to travel overseas to access specialised
treatments which are not available in hospitals in their home countries;
expected shorter waiting times relative to western countries for elective surgeries;
and
availability of cost effective treatment.
Comparison of Cost of Selected Commonly Done Surgeries in India, USA and other
Key Medical Hubs in the Asia Pacific Region
(US$000) India USA Malaysia Thailand Singapore
Heart Bypass
Surgery
6.7 9.3 80.0 120.0 9.0 10.0 10.0 12.0 16.5 18.5
Angioplasty 7.0 8.2 55.0 60.0 10.0 11.0 10.0 11.0 11.0 12.5
Hip
Replacement
5.2 6.5 42.0 45.0 10.0 11.0 9.0 10.5 12.1 15.0
Hysterectomy 2.5 5.0 18.0 20.0 3.0 4.0 4.0 5.0 5.0 6.0
Knee
Replacement
5.0 6.5 40.0 45.0 8.0 9.0 9.0 10.0 12.0 15.0
Source: F&S. See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific
Region, Section 1.2.4A prepared by the Independent Industry Consultant.
1 See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific Region, Section 1.2.4
prepared by the Independent Industry Consultant.
6
It is expected that Indias medical tourism market will grow more than 30.0% annually
to become a US$2.1 billion industry by 2015.1 The Independent Industry Consultant has
also estimated the number of medical tourists visiting India to increase at a CAGR of
14.0% from 270,000 per annum in 2010 to 520,000 per annum in 2015.1
Projected Growth in the Number of Medical Tourists in India
270,000
320,000360,000
410,000
460,000
520,000
2010 2011E 2012E 2013E 2014E 2015E
CAGR of 14.0%
Source: F&S. See Appendix G Independent Report on the Healthcare Industry in the Asia PacificRegion, Section 2.2.1.2 prepared by the Independent Industry Consultant.
The Trustee-Manager therefore believes that the growing medical tourism market will
benefit RHT, which is well-positioned to offer medical treatment and services demanded
by such medical tourists through the Fortis Hospitals operated (or to be operated) by the
Sponsor Group at the RHT Clinical Establishments and the Greenfield Clinical
Establishments, and the Operating Hospitals operated by RHT.
(6) Under-served Indian Healthcare Market
While there is a strong demand for healthcare services in India, there is a chronic
shortfall of healthcare infrastructure within India to meet such demand. India currently
accounts for nearly 6.0% of the worlds hospital beds but shares 20.0% of the worlds
disease burden.2 Availability of qualified healthcare personnel is also a major challenge
in India with the density of doctors and nurses being significantly lesser than the global
average.3
Density of Healthcare Manpower in India
(Per 1,000 People in 2010)
Availability of Hospital Beds
(Per 1,000 People in 2011)
0.5
1.31.4
2.8
Doctors Nurses
India Global Average
0.9
4.0
India World Health Organisations
Guideline
Source: F&S. See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific
Region, Section 2.1.3.3A and 2.1.3.3 prepared by the Independent Industry Consultant.
1 See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific Region, Section 2.2.1
prepared by the Independent Industry Consultant.
2 See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific Region, Section 2.4.3
prepared by the Independent Industry Consultant.
3 See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific Region, Section 2.1.3
prepared by the Independent Industry Consultant.
7
Based on estimates by the Independent Industry Consultant, India needed an additional
1.0 million doctors and 1.8 million nurses in 2010 to achieve the global average density
of doctors and nurses.1 As of 2011, India is 3.7 million hospital beds short of meeting
the World Health Organisations recommendation of providing four beds per 1,000
people.2
Given the shortfall of healthcare infrastructure in India, the Trustee-Manager is of the
opinion that there will be demand for the healthcare services provided at the RHT
Clinical Establishments and the Operating Hospitals held by RHT.
(7) Government Initiatives to Promote the Indian Private Healthcare Market
Existing investments in Indias public healthcare infrastructure are inadequate to meet
the healthcare needs of the country.2 To address this problem, the Government of India
has been encouraging the participation of players in the healthcare sector to provide
quality healthcare through public-private partnerships, tax incentives and subsidies
among other schemes.3 The Government of India is also actively promoting the health
insurance market to make private healthcare more affordable to the public.4
The Trustee-Manager therefore expects RHT to benefit from the potential growth of the
Indian private healthcare segment.
(B) Diversified Portfolio of Medical and Healthcare Assets and Services across India
The Trustee-Manager believes RHTs portfolio of RHT Clinical Establishments, Greenfield
Clinical Establishments and Operating Hospitals is difficult to replicate.
(1) A Large Portfolio of Strategically Located Clinical Establishments and Operating
Hospitals in India
As at 30 June 2012, the Initial Portfolio had a total land area of approximately 2.8 million
sq ft, 1,782 Operational Beds (as defined herein) and an Installed Bed Capacity (as
defined herein) of 3,197 beds.
The bed capacity in the Initial Portfolio can be further increased, with the Gurgaon
Clinical Establishment having a Potential Bed Capacity (as defined herein) of 1,000
beds and the Greenfield Clinical Establishments having a combined Potential Bed
Capacity of 870 beds.
1 See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific Region, Section 2.1.3
prepared by the Independent Industry Consultant.
2 See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific Region, Section 2.1.2
prepared by the Independent Industry Consultant.
3 See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific Region, Section 2.3.4
prepared by the Independent Industry Consultant.
4 See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific Region, Section 2.2.1
prepared by the Independent Industry Consultant.
8
In addition, the RHT Clinical Establishments, the Greenfield Clinical Establishments
and the Operating Hospitals are located across ten major cities in India and are in close
proximity to local population centres, key residential districts and major transportation
nodes.
400 Potential Bed Capacity
Operational: 4QFY2016
Amritsar
Ludhiana
153 Operational Beds
166 Installed Bed Capacity
75 Potential Bed Capacity
Operational: 2QFY2015
Faridabad
Jaipur
207 Operational Beds
320 Installed Bed Capacity
210 Operational Beds
210 Installed Bed Capacity
Mumbai, Mulund
Mumbai, Kalyan
236 Operational Beds
567 Installed Bed Capacity
44 Operational Beds
52 Installed Bed Capacity
239 Operational Beds
255 Installed Bed Capacity
Bengaluru, BG Road
45 Operational Beds
45 Installed Bed Capacity
31 Operational Beds
31 Installed Bed CapacityChennai, Malar
Chennai
170 Operational Beds
178 Installed Bed Capacity
45 Potential Bed Capacity
Operational: 1QFY2015
Hyderabad
Noida
Kolkata
New Delhi, Shalimar Bagh
126 Operational Beds
373 Installed Bed Capacity
191 Operational Beds
200 Installed Bed Capacity
130 Operational Beds
350 Installed Bed Capacity
Gurgaon
450 Installed Bed Capacity
1,000 Potential Bed Capacity
Greater Noida
350 Potential Bed Capacity
Operational: 4QFY2016
: Clinical Establishments
: Greenfield Clinical Establishments
: Operating Hospitals
Bengaluru, Rajajinagar
Bengaluru, Nagarbhavi
Source: Fortis Healthcare Limited.
9
(2) RHT Clinical Establishments and Operating Hospitals Offering Range of Services
The RHT Clinical Establishments operated by the Sponsor Group and the OperatingHospitals operated by RHT offer a range of healthcare services to patients. The tablebelow shows the range of services provided by these hospitals:
Key Services Offered
Cardiac
Sciences
Neuro-
sciences Orthopaedics
Renal
Sciences
Gastro-
enterology Oncology
Amritsar u u u u u
Bengaluru,
BG Road
u u u u
Chennai, Malar u u u u
Faridabad u u u u u
Jaipur u u u u u
Kolkata u u u u
Mumbai, Kalyan u u u u
Mumbai, Mulund u u u u u
New Delhi,
Shalimar Bagh
u u u u u
Noida u u u u u u
Bengaluru,
Rajajinagar
u
(non-invasive)
u u u u
Bengaluru,
Nagarbhavi
u
(non-invasive)
u u u u
Source: Fortis Healthcare Limited.
(C) Sponsors Strong Operating Expertise in Developing and Managing HospitalBusinesses and Clinical Establishments
(1) A Leading Healthcare Chain in India1 with an Established Operating Track Record
The Sponsor is an integrated healthcare delivery provider in the Pan Asia-Pacific regionwith an operating record in excess of 10 years. The Sponsors current network has 73healthcare delivery facilities with a potential bed capacity of approximately 12,000 bedsand more than 600 primary care centres, 194 specialty day care centres, over 230diagnostic centres and a base of over 23,000 employees, giving it an integratedhealthcare delivery network spanning 10 countries across the Asia Pacific region,including India, Singapore, Australia, New Zealand and Vietnam. In India, the Sponsorhas a network of 66 healthcare delivery facilities, including 32 operating hospitals, threeday care centres and 18 satellite and heart command centres located in public andprivate hospitals and 13 hospital projects which are under development or aregreenfield land sites and which are not yet operational.
The Sponsor has received accreditations and certifications for certain of its hospitalsfrom the Joint Commission International (JCI) based in the United States of America,National Accreditation Board for Hospitals and Healthcare Providers (NABH) in India,National Accreditation Board for Testing and Calibration Laboratories (NABL) in Indiaand the International Organisation for Standardisation (ISO) Standards 9001 and14001.
1 See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific Region, Section 2.4.1
prepared by the Independent Industry Consultant.
10
(2) Proven Capability to Generate Strong Revenue Growth
Revenue from the Sponsors healthcare business grew at a CAGR of 52.7% fromFY2008 to FY2012, driven by successful acquisitions, improved utilisation rates,improving occupancy, decreasing average length of stay for in-patient care and itscontinued focus on high-end healthcare services and specialisation mix.
Sponsors Healthcare Business Operating Revenue (S$ million)(1)
FY2008 FY2009 FY2010 FY2011 FY2012
126151 227
342
685
Source: Fortis Healthcare Limited.
Note:
(1) Based on an exchange rate of S$1.00:`43.552.
(3) Sponsors Track Record in Developing Healthcare Facilities
The Sponsors network of hospitals has grown significantly since 2001, reflecting itsexperience and capabilities in building greenfield hospitals, acquiring third partyhospitals and operating third party owned assets.
Certain milestones and examples of the Sponsors track record are outlined below:
2012
2011
2010
2009
2008
2005
2004
2001
Acquired Fortis Healthcare
International whose portfolio
includes seven international
hospitals
Acquired 85% in RadLink-Asia, an
outpatient diagnostic and molecular
imaging chain in Singapore
Commenced operations at two
greenfield projects at New Delhi,
Shalimar Bagh and Kolkata; Also
launched an Oncology wing at
Mulund, Mumbai
Acquired 10 hospitals from
Wockhardt Hospitals Limited
Commissioning of
hospital at Noida
Started first hospital at
Punjab, Mohali
Acquired 72% stake in Super Religare
Laboratories (Southeast Asias largest
diagnostics laboratory network)
Acquired 24% stake in Parkway Holdings Limited.
Subsequently divested stake in the same year.
Acquired four hospitals located in Delhi, Amritsar and Faridabad
from Escorts Heart Institute and Research Centre Limited
Acquired hospital at Chennai, Malar
Source: Fortis Healthcare Limited.
New Delhi, Shalimar Bagh Clinical Establishment: The Sponsor commencedoperations in September 2010 at the hospital in New Delhi, Shalimar Bagh. Thehospital has an Installed Bed Capacity of 350 beds and will have an eventualcapacity of 550 beds when all planned phases of development are completed. Thehospital offers super-specialty healthcare services in cardiac sciences,neurosciences, renal sciences, orthopaedics, obstetrics and gynaecology.
Gurgaon Clinical Establishment: The Gurgaon Clinical Establishment hascommenced trial runs and will be operated as a multi-specialty tertiary hospitalthat will focus on trauma, paediatrics, oncology, cardiac sciences, gynaecologyand orthopaedics as Centres of Excellence. The facility will be equipped withthree heart command centres, 20 modular operation theatres and a stem celllaboratory when all planned phases of development are completed. The GurgaonClinical Establishment currently has an Installed Bed Capacity of 450 beds and willhave an eventual capacity of 1,000 beds when all planned phases of developmentare completed.
11
Kolkata Clinical Establishment: The Sponsor commissioned operations in
September 2010 at its hospital in Anandapur, Kolkata, which the Sponsor acquired
when it was still under construction. The Fortis Hospital operating at the Kolkata
Clinical Establishment with an Installed Bed Capacity of 373 beds focuses on
Centres of Excellence in cardiac sciences, brain and spine, bone and joints as
well as minimal access surgeries in eastern India.
The Trustee-Manager believes that RHT will be able to benefit from the Sponsors
expertise in managing, operating, developing and acquiring healthcare assets to
generate attractive returns and growth for Unitholders.
(D) Strong Potential for Organic and Inorganic DPU Growth
(1) Stable Portfolio Underpinned by High Proportion of Income Generating RHT
Clinical Establishments
As at the Listing Date, all of the RHT Clinical Establishments in the Initial Portfolio will
be income generating. These 11 RHT Clinical Establishments account for 95.4% of the
total valuation of the Initial Portfolio, providing RHT with an attractive combination of
stable income generating assets and upside growth potential by way of the
development of the Greenfield Clinical Establishments.
(2) Hospital and Medical Services Agreements Providing Upside Exposure with
Stabilised Returns
Under each Hospital and Medical Services Agreement, the Hospital Services Company
will receive a quarterly Base Service Fee which will be increased periodically and
revised upwards for any capital expansion for any upgrade or expansion of the Fortis
Hospital or the services provided by the Hospital Services Company. In addition, the
Hospital Services Company will receive a Variable Service Fee based on the Operating
Income of the Fortis Operating Company (see Certain Agreements Relating to RHT
Hospital and Medical Services Agreements for further details). Such a fee structure
provides RHT with stabilised returns while offering RHT the opportunity to participate in
the operational growth of the relevant hospital. The Base Service Fee (including
straight-lining impact) to be received by RHT in the Forecast Year 2013 and the
Projection Year 2014 is expected to account for 78.9% and 76.5% of the total Service
Fees respectively.
The Trustee-Manager therefore believes that RHT has the potential to enjoy strong
organic growth by capitalising on the Sponsors expertise and experience in managing
and operating the Fortis Hospitals at the RHT Clinical Establishments, supported by the
strong underlying growth in the industry.
12
(3) Inorganic Growth Potential through Third Party Acquisition Opportunities and
Right of First Refusal granted by the Sponsor
The Indian healthcare market is highly fragmented, with nearly 95.0% of private
hospitals being standalone small or medium-sized hospitals and nursing homes as of
2010.1
The Trustee-Manager believes such smaller facilities in this fragmented market
represent potential acquisition opportunities for RHT. RHT will be facilitated by the
Sponsors expertise to execute acquisitions of hospitals and healthcare facilities where
RHT intends to appoint the Sponsor (or one of its subsidiaries) as operator.
Outside India, the Trustee-Manager believes there is significant potential for RHT to
grow through acquisitions due to the expected growth of the healthcare sector in the
Asia-Pacific region.2 Supported by the Sponsors presence in India and other Asian
countries, RHT is well-positioned to source and pursue third party acquisition
opportunities for medical and healthcare assets and services.
The Sponsor has also granted a right of first refusal to RHT over any proposed offer by
the Sponsor or any of its subsidiaries to sell, transfer or otherwise dispose of any
interest in any medical and healthcare infrastructure and facilities within the scope of
RHTs investment mandate (Relevant Asset). As the Sponsor continues to capitalise
on its existing experience in building, operating and acquiring hospitals to continue its
growth, RHTs potential acquisition pipeline of assets via the ROFR (as defined herein)
may grow as the number of Relevant Assets increases. See Certain Agreements
Relating to RHT Right of First Refusal for further details.
(4) In-Built Development Pipeline of Clinical Establishments to Boost Growth
RHTs Initial Portfolio includes four Greenfield Clinical Establishments:
Name of
Greenfield
Clinical
Establishment
Planned
Built-up Area
(sq ft)(2)
Expected
Development
Cost(1)(2)
Expected
Start of
Development(2)
Expected
Start of
Operations(2)
Chennai 38,072 `114.0 million
(S$2.6 million)
3QFY2013 1QFY2015
Ludhiana 92,318 `646.6 million
(S$14.8 million)
2QFY2013 2QFY2015
Hyderabad 400,000 `1,600.0 million
(S$36.7 million)
1QFY2014 4QFY2016
Greater Noida 350,000 `1,225.0 million
(S$28.1 million)
1QFY2014 4QFY2016
Notes:
(1) Denotes the expected total costs of development to be incurred by RHT in respect of each Greenfield
Clinical Establishment.
(2) Planned built-up areas, expected development costs, expected start of development and expected start
of operations are subject to change.
1 See Appendix G Independent Report on the Healthcare Industry in the Asia Pacific Region, Section 2.4.3
prepared by the Independent Industry Consultant.
2 In selected countries as listed in the report by the Independent Industry Consultant. See Appendix G
Independent Report on the Healthcare Industry in the Asia Pacific Region, Section 1.1 prepared by the
Independent Industry Consultant.
13
(E) Experienced Management, Board and Investment Advisor
The Trustee-Managers Board and management team and personnel from Religare
Investment Advisors Limited, the investment advisor (Investment Advisor) to Religare
Health Trust Trustee Manager Pte. Ltd. (acting in its own capacity) (RHT TM), are made up
of individuals who collectively have a range of commercial expertise includ