Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. We take the first question from the line of Maulik from 360 One Capital. Please go ahead.

Hi, sir. Thank you for the opportunity. I have two questions. So, firstly, sir, our volumes have grown by approximately -- surgery volumes have grown by approximately 15%, 16% and the revenue has grown by approximately 26% -- 26.5%. So, within this, sir, how much would be our value growth, which is basically the case mix and the price hike -- case mix as in the high-end surgery and the price hike, how much would their contribution be into the growth?

Yes, Maulik. Thanks, Maulik. I'll just request our COO, Rahul Agarwal to take this. Rahul Agarwal Hi, Maulik. So, broadly from a price hike perspective, overall, the value will break it up into premiumization and price hike. On the premiumization we are close to around 7.5%. And price hike, so far this year, we have realized around 0.5%. So, overall, closer to 8% is what we have realized from a premiumization and price hike. This is on a like-to-like basis over last year.

Okay. Thank you, sir. And how much would our losses for the new facilities which we've recently opened?

Rahul Agarwal Overall, the green plot is around close to INR20 crores at corporate EBITDA level.

Sorry sir, I missed, you said INR24 crores… Rahul Agarwal INR20 crores. This includes both the centers launched in FY '26 and FY '27. Also includes pre- operating losses as well.

Okay, sir. Okay. INR20 crores. Okay. I will join in the queue. Thank you.

Thank you. We take the next question from the line of Nikhil from SiMPL.

Yes. Hi. Good evening. Congrats on great set of numbers. I hope I am audible.

Yes.

Yes. I have three questions. Two are bookkeeping, one is, Venkat, you've mentioned during the call that in interest cost there is this reduction in deferred liability. So, can you give a split of what is the lease liability payment of interest cost and what is the deferred run rate now?

Yes. Sure. For the first qu arter, we have paid close to INR25 crores as far as the acquisition liabilities go. Now, in terms of the interest on lease liability for Q1, it is around close to INR18 crores.

Okay. And second is this SSSG -- and I'm talking about the number for up to FY '23, the 16% growth seems very strong. For these facilities, what would be the footfall growth in this 16% SSSG up to FY ‘23 facilities? Rahul Agarwal Hi. So, overall, on the SSSG front, if I were to breakdown the volume and value, volume grew by around 8% and value grew by around 8%. So , it's a breakup between the two. And on the volume front, the OPD growth which has given us the value growth of 8%, there's a 6% -- the OPD growth value and then there is another 2% which we are getting in from conversion, yes.

And specifically, when we talk about facilities up to FY23, even there we've seen a very strong, healthy growth. So there also the split between footfall and value would be similar?

Yes, so broadly what I gave was for the SSSG one only which is up to FY23. For the ones which are beyond that, over there our volumes will be slightly higher because they are still newer facilities. The OPD volumes are still growing in these spaces. So that will be faster growth in the volume side.

Okay. And last question, see, I think you mentioned North is growing very well. And even in the number of surgeries, the growth if you look at it significantly outpacing over the last 3 quarters. So, is it purely driven by Delhi -NCR region or is this growth equivalently visible in smaller markets as well? So, can you just split it up like what is working for us in this -- like, if we look at last three quarters, the growth – the average growth is almost 25% , in number of

surgeries done in North market. So what is playing out for us between NCR and non -NCR market?

I'll give you more from an overall perspective, what we are seeing is that Delhi, of course, is a new entry. So, everything is a growth this year. Last year, we just started with one branch to now we already have seven branches over there. So that's one of the largest growth drivers. However, Punjab also this -- I would say, specifically for this quarter last year, we had an impact of Operation Sindoor in a lot of our branches, which is also helping us this quarter from an overall growth perspective. But yes, at a broad level, we are seeing a trend which is very, very positive for us in North across all our branches.

And including Delhi, if we look at the number of surgeries per surgical center, would that number be now equivalent to what you do in South in a stable state? Or is there still a gap?

Not at all. I think from a scale-up perspective, as we mentioned that three years at least it takes us from moving from an emerging facility to becoming a mature facility. I think it's a long way for us in Delhi to become a mature facility. I don't think we'll be anywhere close to where our South centers will be.

Okay, fine. Thanks. I'll come back in the queue.

Thank you. Participants who wish to ask a question, please press star and one. We take the next question from the line of Tushar Manudhane from Motilal Oswal Financial Services Limited.

Hi, sir. Am I audible? Congratulations on good set of numbers. I would like to ask on the number of doctors that got added, almost 23% year -over- growth and almost crossing like 1,000 in number, in fact, 1,057, which is almost 23% growth in the number of doctors. So, is this addition of doctors largely sort of done for the facilities that have got added? Or would we look for more doctor addition for the facilities which -- including the recently launched ones? If you could throw some light on that.

Most of these -- most of these doctors are for the new centers which have been added. And that's what accounts for the thing. For the existing centers, the number of new doctor additions is not that much. Most of the new centers which we have added is what is leading to this increase in doctor numbers. Tushar Manudhane So basically, the cost is largely factored into this quarter and in fact, the revenue growth because of whatever addition in surgeries on account of these doctors is still to sort of come which will come in the subsequent quarters. Is that the right way to understand?

Correct. So, the last four months alone, we have added 100 new doctors to our network, so in many of these centers, especially in Maharashtra, in Delhi-NCR, many new doctors have joined the network. We will start to see improvements in their productivity as time goes by and as the centers start to mature.

Tushar Manudhane In fact, just as an extension to this, so the additional facilities which are going to get added in, let's say, North and West, the doctor addition is largely done f or those reasons -- for the new centers also, that would be over and above?

The way we plan it is as and when we know that -- we have a pipeline in terms of exactly when the centers will be up and running. A few weeks prior to them is when we will onboard them. But we have a list of all the doctors who are going to be joining us and many of those agreements have already been signed. A few weeks before the center is launched -- around the time the center is launched, the doctors will get onboarded into our system.

And what would be the attrition rate for the doctors?

I think we're still at that 16%, 17% attrition rate overall at a group level. This includes a lot of junior doctors and a lot of students who have jo ined us. But still, our attrition rate for senior doctors is still at that 2% to 3%, it is very, very low right now for senior doctors. Senior doctors usually don't leave us. Tushar Manudhane Got it. That's very encouraging that senior doctors' attrition rate is very low. So that's quite encouraging. Sir, secondly, while you already highlighted the break, but if I look at the total number of surgery growth, which is like 15%, and revenue growth for the surge ry is roughly 25% to 26% growth, but if I look at the total number of surgery growth, which is like 15% revenue growth for the surgery is roughly 25%, 26%. So, now this base effect of almost 15% -- another 10% growth in the average realization, probably that would -- now that we are almost at INR42,000, INR45,000 per surgery cost and that grace effect goes away, so would we still see the average increase in realization at the similar pace of 10% growing in the coming next 12 to 15 months? Or would we sort of plateau on the realization and the surgery growth is what will drive 20% revenue growth going forward?

From an SSSG perspective, Tushar, if you see really two years back, last year, we have come down slightly, but the year before that, we were again a similar range of around 16%. I think from a volume perspective, yes, we feel strongly that we'll continue with the current scheme of things. From a value perspective, again, four years back, we were close to INR28,000 to INR30,000 as an aver age realization per cataract, which has now grown to around INR42,000. This has happened due to -- as patients also with more insurance and their disposable income going up, with them wanting better lenses, so slowly over a period of time, they also keep g oing up on that. There's another strategic change which has happened with more Femto cataracts coming in. The realization is going up in those Femto cataracts. Of course, the number is very low right now. But we feel that over a period of time, these technologies will percolate further across the country. And more and more patients -- we have already seen that happening. And we feel that it will only continue where more robotic cataracts also will be a patient ask as well.

So, it's difficult to answer whether same 10% will be there or 8% will happen. But I think over a period of time, this shift will continue happening as insurances grow, as the economy grows and as our technology continues to keep getting upgraded. So, while I'm not able to give you a complete answer on that, but I think from a direction perspective, the answer is yes.

Got it. While this technology upgradation does help patient a lot, no doubt in that, but at the same time, technology probably would be coming at a higher cost. So while the volume would grow and so, let's say, EBITDA at an absolute rate, but would the margin maybe get a little lower because of the higher cost associated to new technology or the margin will still get strengthen from here, only considering the technology aspect?

Rupee gross margin will definitely go up because for a Femto cataract procedure, in terms of additional charge, it will be close to about INR35,000, whereas the click fee which you will be paying for the license, that comes to around INR10,500, INR11,000. So rupee gross margin will definitely go up.

Got it. That's interesting. And just lastly on the number of facilities that got added, while highest ever quarterly run rate and while the cash flow is also s ufficient enough, so why we sort of getting constrained in terms of the facilities that we are adding in upcoming quarters or let's say, full year '27, can that launch pace be increased further?

We are working on improving the launch pace. I think we have set that benchmark by this quarter. We have a few properties in the pipeline. And as you know, some of these places, we want to make sure that you have the right compliance properties. But that said, we are working very actively on improving the pace of actually ramping up new center additions, which you will see as we progress in the coming quarters right now.

Got it, sir. Thanks a lot and all the best.

Thank you. We take the next question from the line of Maulik from 360 ONE from Capital.

Just wanted to understand, our South region has grown by approximately 23% in the first quarter. So, can you help us with some direction in terms of the SSSG for our mature facilities in the South, will it be higher than our other regions? Or will it be in line? Can you help us?

The SSSG growth for our South center is pretty much in line with what Rahul had mentioned, which is the cohort up to FY26 are growing approximately 16.5%, and that's effectively what we are seeing across many of our markets in Chennai, Bangalore and many of these markets are following a similar same-store sales growth pattern.

Okay. So, South being our key market and a much more mature market will continue to witness this healthy SSSG going ahead as well?

It is our endeavour to hope to continue with a similar same-store sales growth pattern. But as we have spoken in the previous meetings before, I think anything around the 12% to 13% mark if

we can touch is someth ing which is phenomenal. So highly appreciative of what the work is being done by our doctors and our operations teams for us to deliver 16.3% SSSG growth.

Okay. Sir, I just wanted a clarification, you mentioned in the opening remarks regarding the improvement in gross margin and reduction in finance costs. Can you help in repeating, please? Can you repeat that, please?

Yes. So, I'll just request Yashwanth to comment. I think what he was mentioning is there was at least close to 1% improvement in our overall cost of goods sold and also there was improvement in the finance costs. So, these are 2 line items where we saw significant improvement. I'll just request him to step in.

Yes, finance cost actually moved from about close to INR24.7 crores in Q1 of last year to about close to INR23.5 crores. What I had mentioned in the opening remarks was there was a saving from the interest on deferred acquisition payable. The interest on deferred acquisition payable was about close to INR6.8 crores in corresponding quarter of last year, which dropped down to about INR3.6 crores, I think, with the payment of about close to INR25 crores on the d eferred acquisition payable, which was affected in Q1. And as Dr. Adil mentioned, overall, the COGS, there was an improvement of about close to 1%, which roughly translated to a gross margin improvement of about 1%.

Okay. Understood, sir. Thanks a lot.

We take the next question from the line of Paras Sarkar, an Individual Investor.

My question is I just wanted an update on the merger. By when can we expect the merger to get completed?

So, we are in the process of closing some of the final items when it comes to the merger, and we expect to close this around mid-November.

Ladies and gentlemen, with that, we conclude the question-and-answer session. On behalf of Dr. Agarwal's Health Care Limited, that concludes this conference call. Thank you for joining us, and you may now disconnect your lines.