Digital health platforms like ours poised for big growth

Riding on the digital wave, Kolkata-based SastaSundar has already marked its presence in three verticals- e-pharmacy, diagnostic and wellness. Two Japanese transnationals- Mitsubishi Corporation and Rohto Pharmaceuticals Co. Ltd have already put in 27 per cent stakes in the company. The company is now looking at raising another Rs 350 crore to build tech infrastructure, expand geographical reach and emerge as a holistic wellness company. Speaking to Bizz Buzz in an exclusive interview, B L Mittal, Founder & Executive Chairman of SastaSundar, shares his thoughts on the emerging business model

SastaSundar brought the concept of HealthyBuddy which is an innovative and unique idea of establishing physical healthcare centres in every locality and has its presence in 23 districts of West Bengal. It has already started its operation in Delhi - Haryana, Jharkhand and Western Uttar Pradesh. OTC products can be availed PAN India

Mitsubishi Corporation and Rohto Pharmaceuticals Co., Ltd have 27 per cent stakes in the company. We plan to raise nearly $50 million (nearly Rs 350 crore) in equity over the next one year. We are in talks with a number of investors including our existing foreign investors

The pandemic is believed to have come in handy for digital healthcare platforms. How has it pushed your topline and bottomline? How many orders did you receive during the lockdown?

The pandemic has been good for digital platforms like us. Getting the right products delivered at home at the right time and keeping the products, particularly medicines, available were the key. During the lockdown period of April to June 2020, SastaSundar delivered more than 18 lakh orders right to the consumer doorsteps following all safety protocols. With its efficient model, SastaSundar is the first company in India, in the e-pharmacy space, to almost break even. We took some extra initiatives, extra care. We had introduced and kept our own fleet of buses, vans and other vehicles ready 24x7. We had also introduced the cheapest textile masks, sanitisers with 15 per cent discount and also came up with kada and seven dry fruits-based immunity booster products, which were well accepted by consumers.

Do you think this trend is here to stay?

While demand for masks and sanitisers may come down to some extent over a period of time, the trend of increasingly looking for healthcare and wellness related products, especially immunity booster products will certainly continue. Mind you that there have been significant changes in consumers' mindset and psyche.

SastaSundar is present in three spaces: Pharmacy, Diagnostics and Wellness, right? What would be the break-up of these three sub-verticals in your overall business?

As of now, the pharmacy or e-pharmacy segment is growing much faster. But I have no doubt whatsoever that with growing awareness and increasing focus, the other two segments will also grow significantly, though may not be as fast as the e-pharmacy. They will certainly witness substantial growth.

Going forward, which one of these segments will grow faster and why?

Insofar as we are concerned, we will increasingly focus on diagnostic and wellness segments, while keeping our thrust on pharmacy intact. We have already set up eight Genu Path Labs in Kolkata and Howrah. Genu Path Labs is a state-of-the-art pathology and diagnostic centre in Kolkata. It boasts of expert pathologists and doctors. Genu Path Labs is an epitome of pathology services in the city of Kolkata. Leading clinicians work in coordination with our pathologists to ensure that most advanced tests are offered with 100 per cent accuracy in results on each test every time and reliable performance. It adheres to strict policies and operation model standards that ensures accuracy and incomparable quality. Genu Path labs is also increasing its test menu to accommodate the changing needs of the healthcare scenario. We aim to offer the best of services and facilities to the common man. Our plan is to have at least 100 Genu Path Labs across West Bengal over the next three years. And then eventually we will move out of Bengal and have a pan India presence.

Similarly, we have recently forayed into the domain of preventive wellness. In this endeavour, we have teamed up with Asics, a Japanese-based leading sports footwear and apparel MNC. Producing innovative sports products solutions and technologies, Asics works towards helping athletes and active consumers achieve their personal fitness goals. To such ends, the organisation also operates an inclusive running group led by experienced runners called the Asics Running Club.

Chronic lifestyle diseases constitute a major pain point of the Indian healthcare landscape. On critical analysis of its customer database, SastaSundar observed that 90 per cent of our customers suffer from some form of chronic disease or the other. For such patients, preventive wellness in the form of the right diet, fitness, exercise regime, morning walks and yoga, etc. are more essential than medicines. And, health accessories like sports shoes and equipment lie at the heart of such wellness measures.

For individuals suffering from chronic diseases and fitness enthusiasts alike, choosing the right sports and fitness accessories represent a critical step towards preventive wellness. Sports shoes are especially important because for any fitness regime, be it running, gym practice or playing, quality shoes ensure that one receives the optimal benefit from the exercise session. Moreover, good quality sports shoes are also recommended by healthcare experts to diabetic individuals. We have started making available sports shoes on the SastaSundar website and app. These shoes can be ordered from there and will be delivered across the PAN India market. Furthermore, the facilities of attractive discounts and free home delivery have been added to add to the customer delight. Endeavours are also being made by SastaSundar to make available to its customers, various other Asics sports equipment and related products.

Could you throw some light on your initiative called- "HealthBuddy"?

SastaSundar brought the concept of HealthBuddy which is an innovative and unique idea of establishing physical healthcare centres in every locality. SastaSundar has its presence in all the 23 districts of West Bengal and has already started its operation in Delhi - Haryana, Jharkhand and Western Uttar Pradesh and very recently, also in Bihar. Additionally, our online services and OTC products can be availed PAN India. With two area logistics centres (warehouses) already up and running in West Bengal and Noida, the third area logistics centre and Healthbuddy network has now been initiated in Maharashtra as well. We now have 430 Healthbuddy outlets across nine states- West Bengal, Jharkhand, Bihar, Orissa, UP, Delhi, Haryana, Maharashtra. Healthbuddy will have its pan India presence in the next one year. Health buddies are all individual entrepreneurs with space and at least one trained pharmacist.

How big is the overall e-pharmacy market in India now and at what rate is it growing?

According to a new EY report 'e-pharma: delivering healthier outcomes', e-pharma players are expected to attain a combined market size of $2.7 billion by 2023 from about $360 million currently in the next four years. According to Frost & Sullivan, the e-Pharmacy market in India is estimated to be around $512 million ( nearly Rs 3,500 crore) in 2018 and is estimated to grow at a CAGR of 63 per cent to reach $3,657 million (nearly Rs 25,000 crore) by 2022. SastaSundar, with an annual GMV run rate of over Rs 700 crore, has a substantial share in the e-pharmacy market.

How much have you invested in building digital and physical infrastructure? How much would you be investing over the next two years and how would you spend this fresh investment? How do you plan to raise this funds?

The SastaSundar business has a total investment of nearly Rs 351.75 crore contributed by holding company SastaSundar Ventures Ltd. and two Japanese companies namely Mitsubishi Corporation and Rohto Pharmaceuticals Co., Ltd.

How much have the two Japanese companies- Mitsubishi Corporation and Rohto Pharmaceuticals Co., Ltd invested in the company? How much equity do they hold? Any plans to have more funds from them or any other foreign companies?

The two Japanese companies have 27 per cent stakes in the company. We plan to raise nearly $50 million (nearly Rs 350 crore) in equity over the next one year. We are in talks with a number of investors including our existing foreign investors. We are flexible and are ready to dilute promoters' equity holding further. We will spend this amount in building technology, expanding our geographical reach and emerge as a 360 degree wellness company.

We have already set up a unique online diet clinic is known as Yana Diet Clinic for personalized diet plans, "Know Health" – a health information service providing personalized health-related knowledge using artificial intelligence, customised 'Made-To-Order' DNAVITA health supplement, health food range, physical counselling by pharmacists and health tools such as medicine reminders, BMI calculators, pregnancy calculators and vaccination trackers.